Europe met with pressure to boost fiscal crisis fund

• Source: Global Times
• [08:47 January 17 2011]
• Comments

Eurozone finance ministers head into a meeting today under pressure to ramp up the firepower of a debt-rescue fund, even after markets have backed off pressure on vulnerable nations.

Europeans are divided over how quickly they need to act and how much added muscle they should give to the financial safety net that was created last year to provide cover to weak countries, following a huge bailout of Greece.

European Commission President Jose Manuel Barroso urged leaders to make a decision by their next summit, February 4.

The EU's rescue mechanism was used to pull Ireland from the abyss in November after a banking disaster, but analysts have repeatedly warned that it would be too small to rescue Spain if it ever needs a bailout.

Belgian Finance Minister Didier Reynders called this week for the safety net to be doubled to 1.5 trillion euros ($2 trillion) and said he hoped to raise the issue at the eurozone ministers' monthly meeting in Brussels.

But German counterpart Wolfgang Schaeuble, whose country has the biggest commitment in the European Financial Stability Facility, said a debate on increasing the size of the pot was "not realistic."

German Chancellor Angela Merkel said Saturday that any measure to stabilize the euro should come within a complete strategic package, dampening hopes for a quick decision on moves to tackle the eurozone debt crisis.

Agencies