BERLIN (MNI) – German Chancellor Angela Merkel told members of her
CDU/CSU parliamentary group on Friday that there exist no differences
between Germany and France regarding the European Financial Stability
Facility (EFSF), a source from the parliamentary group said after the
meeting.

“The Chancellor has said there exist no dissent between Germany and
France” the source explained. “This came also for us as a surprise,” he
remarked, adding that Merkel did not elaborate on that further.

Joerg van Essen, the parliamentary executive secretary of the FDP,
the junior partner in the government coalition, said Merkel had told FDP
parliamentarians today that she still opposed the idea of giving the
EFSF a bank licence.

Yet, amongst the 17 Eurozone stations there also still exists
disagreement over increasing the firepower of the EFSF via a so-called
insurance solution. Under this concept, the EFSF would insure a certain
percentage of a bond in order to minimize the risk for private
investors.

“Some states believe that such a solution would be rather
detrimental to them,” van Essen cited the Chancellor. Especially Italy
and Spain fear that such an insurance solution would make their bonds
look like second class issuances, he said.

The source from the CDU/CSU group said Merkel was currently
planning to deliver a government declaration in parliament on the matter
on Wednesday ahead of the EU summit planned for the evening of that day.
However, this still hinged on the condition that an agreement amongst
the Eurozone states can be reached until then, he said.

German Finance Minister Wolfgang Schaeuble told CDU/CSU
parliamentarians today that there still exist a disagreement between the
IMF and the EU Commission about paying out the next tranche of financial
aid to Greece, the source said.

Schaeuble has again underlined that the aid to Greece will only be
paid out if all members of the troika — the IMF, ECB and EU Commission
— will have given the green light for that, the source said.

–Berlin bureau: +49-30-22 62 05 80; email: twidder@marketnews.com

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