BRUSSELS (MNI) – The International Monetary Fund would be prepared
to invest alongside the European Financial Stability Facility to help
leverage the Eurozone’s bailout fund, a senior IMF official said on
Thursday.
“Our thinking is that the best way to add leverage to the fund is
not so much to allow it to borrow money but to use its resources in a
way that persuades other investors to invest alongside them,” said
Antonio Borges, Director of the IMF’s European Department.
The IMF could be such an investor, he said, adding that “we would
be ready to play that role,” possibly through a special purpose vehicle.
The idea is “one of many possibilities,” he said.
A spokesman for the European Commission, however, played down the
possibility, saying that the Commission had “no particular reaction.”
Finance ministers from the 17 EU members that use the euro, who met
in Luxembourg on Monday spoke of a need to enhance the “efficiency” of
the E440 billion EFSF, but they declined to elaborate on the options
being considered, other than to say that they were unlikely to involve
the European Central Bank.
On the Greek debt crisis, the senior European IMF official said
there was “no urgency” and that there was “plenty of time”.
Should EU officials decide to change the terms of the
debt-restructuring deal back in July, the “IMF could operate on a bigger
or lower haircut,” he said.
–Brussels newsroom +324-9522-8374; pkoh@marketnews.com
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