BRUSSELS (MNI) – The deal struck by EU finance ministers to give
loans to any heavily indebted member state which fall into difficulty
shows that any attempt to weaken the stability of the euro will fail, a
European Commission spokesperson said on Monday.
European Union finance ministers early Monday announced a package
worth at least E720 billion in EU, Eurozone and International Monetary
Fund loans to shore up the single currency. The European Central Bank
said it will deploy fresh supportive measures.
E440 billion of the total will come from the Eurozone countries by
way of bilateral loans and loan guarantees, the finance ministers said,
without providing a breakdown. Later Monday, Commission spokespeople
also declined to detail what the split would be.
The spokesperson said that the new deal enables European
policymakers to respond to “difficulties in any Euro area member state,”
and proved that “any attempt to weaken the stability of the euro will
fail.”
The Commission said that it “welcomed” the announcement that Spain
and Portugal would take additional steps to consolidate their budgets,
but said it had not formed a judgement on the new measures yet because
it had not received the full details from the respective governments. It
said it was in “close contact” with the Spanish authorities but had no
indication that either Spain or Portugal would use the new facility.
In any case, a spokesman for Economic and Monetary Affairs said
most EU countries should step up efforts to consolidate their budgets in
next year.
He also said the Commission is very close to proposing new
legislation to enhance the enforcement the fiscal EU rules set out in
the Stability and Growth Pact, which requires member states to keep
their budget deficits below 3% of GDP or face penalties.
–Brussels: 0032 487 (0) 32 803 665, echarlton@marketnews.com
[TOPICS: MT$$$$,M$$FX$,M$$EC$,M$X$$$,M$$CR$,MGX$$$]
