Merkel gives ground on higher euro firewall

Chancellor Angela Merkel indicated Monday Germany was prepared to allow a boost in the eurozone's firewall against the eurozone debt crisis ahead of talks on the issue by European finance ministers.

In an apparent shift of position amid fierce international pressure, Merkel said Berlin was open to combining 500 billion euros ($662 billion) from a permanent rescue fund that comes into effect in July with 200 billion euros already promised to debt-ridden countries.

While insisting that the permanent fund, the European Stability Mechanism, should stay capped at 500 billion euros, "we could imagine ... that it could run in parallel with the programmes already handed out -- so 200 billion (euros)," Merkel told reporters.

The two funds could run in parallel until the 200 billion euros is paid back by so-called "programme countries" that have already received bailouts -- Ireland, Portugal and Greece, she said.

"This will take several years and then the ESM will stand alone with its 500 billion euros," she explained.

This would potentially give the eurozone some 700 billion euros in funds to combat any possible future crisis -- if for example a bigger country such as Spain or Italy were to require a bailout.

European Union finance ministers are set to debate the issue during two days of informal talks in Copenhagen starting on Friday.

Earlier Monday, Amadeu Altafaj, spokesman for EU Economic Affairs Commissioner Olli Rehn, upped the pressure on ministers, saying: "We think it's essential that we come to an agreement at the end of this week in Copenhagen.

"Our baseline is very well known: we think that having a strong firewall in place is an element to reinforce confidence in our crisis response," he said.

Even the option now under consideration in Berlin is thought of as the least ambitious of the proposals put forward in Brussels.

The International Monetary Fund, the United States and other top economies worldwide have sought to raise pressure on Germany to drop its previous opposition to boosting the eurozone's firewalls against debt crisis contagion.

The group of 20 top economies indicated at a meeting last month they would increase their loans to the IMF to bolster the international lender's defences against the crisis but insisted the eurozone first put its hand in its pocket.

This decision is likely to be taken at a meeting in Washington on April 20-22.

Merkel said that recent movements on the bond markets -- particularly in Portugal and Spain where debt fears are resurfacing -- has shown that the crisis is far from over.

"Much has got better in the eurozone but we are still not in a normal situation and I think we will still be busy for a long time with genuinely overcoming the sovereign debt crisis," Merkel said.

Any proposal on the bailout funds needs parliamentary approval and Merkel faces a public that is tired of providing the bulk of the bailout money for the ailing eurozone.

Loading...

Editor’s note:Yahoo Philippines encourages responsible comments that add dimension to the discussion. No bashing or hate speech, please. You can express your opinion without slamming others or making derogatory remarks.

  • Developers prepare for new rules and regulations
    Developers prepare for new rules and regulations

    Known as the "Subdivision and Condominium Buyers' Protective Decree," Presidential Decree No. 957 issued two sets of revised implementing rules and regulations (IRRs) earlier in 2015. A bill initiated by former President Ferdinand Marcos in 1976, the decree and its most recent amendments were designed to "protect buyers from fraudulent and unscrupulous subdivision and condominium sellers, operators and developers," according to the explanatory note that accompanied the bill in its senate …

  • ‘Get SAF 44 killers before BBL passage’
    ‘Get SAF 44 killers before BBL passage’

    Lawmakers are demanding the arrest of the Moro Islamic Liberation Front (MILF) fighters involved in the killing of 44 policemen in Mamasapano before the approval of the proposed Bangsamoro Basic Law (BBL) in Congress. Cagayan de Oro Rep. Rufus Rodriguez, chairman of the 75-member ad hoc committee in the House of Representatives deliberating on the BBL, prodded the Department of Justice (DOJ) to speed up its investigation and file charges against the MILF guerrillas as the Aquino administration …

  • Pinoys dance for Earth Hour
    Pinoys dance for Earth Hour

    The Philippines once again displayed its support Saturday night for the worldwide observance of Earth Hour by hosting a dance party after turning the lights off from 8:30 to 9:30 p.m. to save energy and make a statement on various environmental issues. The World Wide Fund for Nature (WWF) said widespread participation proved anew that no individual action on climate change is too small and that no collective vision is too big with celebrations in over 7,000 hubs in 170 countries. The WWF said …

  • Phl offers Sabah to win Malaysia’s support for UN case vs China
    Phl offers Sabah to win Malaysia’s support for UN case vs China

    The Philippines has offered to downgrade its claim on Sabah in exchange for Malaysia’s support for its case against China before the United Nations. The quid pro quo was contained in a note verbale the Department of Foreign Affairs (DFA) handed to a representative of the Malaysian embassy last week, a week after the visit of Malaysian Defense Minister Dato  Seri Hishammuddin Tun Hussein. The note verbale, a copy of which was obtained by VERA Files, referred to the May 6, 2009 joint submission …

  • Maysak to enter Phl Wednesday
    Maysak to enter Phl Wednesday

    A typhoon with international name Maysak is expected to enter the Philippine area of responsibility (PAR) on Wednesday and bring rains over Northern Luzon by weekend, the state weather bureau said yesterday. Aldczar Aurelio, weather forecaster of the Philippine Atmospheric, Geophysical and Astronomical Services Administration (PAGASA), said the typhoon was 2,810 kilometers east of Mindanao as of 10 a.m. yesterday. “This typhoon is still too far to affect any part of the country,” the weather …

  • Nonviolent disciplining of kids pushed

    Child rights advocates called on senators to pass and strongly endorse a law that will institutionalize positive and nonviolent methods of disciplining children.The Child Rights Network (CRN), Plan International Philippines (PIP), Philippine Legislators’ Committee on Population and Development (PLPCD), and Lihok Pilipinas Foundation led the call for the enactment of the Positive Discipline Bill.Several Quezon City Council members led by Majority Floor Leader Jesus Manuel Suntay, Victor Ferrer …

  • Method to their madness

    [caption id="attachment_256768" align="alignright" width="212"] Illustration by Rod Cañalita[/caption] EMMANUEL PORTUGAL Country Manager for the Philippines, VMware I look after the garden. I’d like to think that I have a green thumb—no plants have died so far! The ones I like now that I planted a few months ago is the Blue Iris. Like the town in the movie, my Blue Iris shows up in the morning and only appears for one day. …

  • JGFP Summer Tour on today

    The summer tour for local junior golfers kicks off with the holding of the ICTSI-JGFP Baguio Junior Open today and tomorrow at the treacherous Baguio Country Club course in Baguio.Sixty players aged 6 to 17 years old are entered in the 36-hole tourney serving as the opening leg of the summer circuit organized by the Junior Golf Foundation of the Philippines with the International Container Terminal Services, Inc. Foundation as main sponsor. ... …

POLL

Should Aquino be held accountable over the Mamasapano operations?

Loading...
Poll Choice Options