BERLIN (MNI) – German Chancellor Angela Merkel on Friday reaffirmed
that current holders of bonds issued by Eurozone member states won’t be
affected by the rules laid out for the future permanent crisis mechanism
in 2013.
“Nobody who currently holds bonds will be affected by it,” Merkel
said at a press conference after a two-day EU summit of heads of states
and governments in Brussels.
On Thursday EU leaders agreed unanimously to create a permanent
crisis mechanism, which also foresees a participation of investors.
European Council President Herman Van Rompuy said Thursday that an
agreement had been reached on the main features of the mechanism, which
will replace the European Financial Stability Facility (EFSF) when it
expires in mid-2013.
He said finance ministers would decide the details of the mechanism
at their March meeting. The amendment to the EU treaty required to
create the mechanism would take effect on January 1, 2013, and the
mechanism would be in place by June 2013. All EMU member nations must
ratify the amendment.
Van Rompuy elaborated some details of the permanent mechanism,
telling reporters it would be designed on the basis of the current
mechanism, meaning that IMF involvement is foreseen.
“Concerning the role of the private sector, decisions will be taken
on a case by case basis,” he said, adding later in a written statement
that “private sector involvement will not be a prior requirement for
support under the future Stability Mechanism.” The private sector will
also not be a primary source of financing in future bailouts.
–Berlin bureau: +49-30-22 62 05 80; email: twidder@marketnews.com
[TOPICS: M$X$$$,MGX$$$,M$$CR$,M$G$$$,MFX$$$]
