FRANKFURT (MNI) – Germany’s proposal for a permanent crisis
mechanism to protect Eurozone governments in financial woes from market
speculation foresees the creation of a fund that would lend money under
strict conditions in exchange for collateral, the daily Sueddeutsche
Zeitung reported Thursday.

In Germany’s view, the new “European Stability, Growth and
Investment Fund” would be “largely politically independent” and oblige
borrowers to manage their finances under “tough rules,” the newspaper
said.

It is in Germany’s “national interest” that the Eurozone be
consolidated with “all” its current members, the newspaper said, citing
the text of the proposal. Monetary union should be oriented toward
“Germany’s interest in stability.” This would be the “quid pro quo” for
the role of the Eurozone’s largest economy as “anchor of stability.”

The fund should be able to refinance itself “without limits” with
guarantees from member states, according to the plan. Governments in
need could draw on credits by providing collateral in the form of gold
reserves or their holdings in public companies.

Ahead of a meeting of Eurozone finance ministers in mid-January,
several other governments have submitted proposals for the new crisis
mechanism, including Ireland, Finland and the Netherlands, the
Sueddeutsche Zeitung noted.

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