EU finance ministers rush to set up rescue channel for euro
By Elena Becatoros and Raf Casert |
May 10, 2010, Monday
|
Print Edition
Print Edition
THE chair of a meeting of European Union finance ministers promised yesterday to do "whatever is necessary" to set up a rescue mechanism for the embattled euro before markets open but did not disclose any details of what's in store.
Spanish Finance Minister Elena Salgado said the ministers would use an emergency meeting to work out plans to improve the stability of the euro after the currency was rocked over the past weeks by the Greek financial meltdown.
"We are going to defend the euro," said Salgado, who presided over the ministerial meeting. "We have to give more stability to our currency ... We will do whatever is necessary" to reach agreement among the 27 ministers.
But so far, the finance ministers have been tight-lipped what the measures will be.
They could involve balance of payment support that has already been available to some EU nations outside of the eurozone. There is also talk about specific loan guarantees, which countries like Britain could well oppose since it could be seen as a bailout fund.
Specific measures will have to be approved by the time markets open today because vague promises have been unable to calm markets over the past weeks.
"We need to make progress today because when the markets are opening, we cannot afford disappointments," Swedish Foreign Minister Anders Borg said yesterday.
"We now see herd behaviors in the markets that are really pack behaviors, wolf pack behaviors," he said.
If unchecked, Borg said, "they will tear the weaker countries apart. So it is very important that we now make progress."
Some eurozone nations blamed the bloc's fragile governments and a lack of European cooperation for the crisis.
Underscoring the urgency, the European Commission was working out the details of the deal even before the meeting started.
"This is an important moment for both the Europeans and the others," said French Finance Minister Christine Lagarde.
Compounding the Greek financial crisis, attention has centered on fragile financial systems of countries like Spain and Portugal, which in turn could drag the whole of the eurozone further down.
"We have to take decisions that will restore the stability of the euro, for the eurozone and we have to work on the mechanism which will be comprehensive and efficient to restore stability," said Lagarde.
Spanish Finance Minister Elena Salgado said the ministers would use an emergency meeting to work out plans to improve the stability of the euro after the currency was rocked over the past weeks by the Greek financial meltdown.
"We are going to defend the euro," said Salgado, who presided over the ministerial meeting. "We have to give more stability to our currency ... We will do whatever is necessary" to reach agreement among the 27 ministers.
But so far, the finance ministers have been tight-lipped what the measures will be.
They could involve balance of payment support that has already been available to some EU nations outside of the eurozone. There is also talk about specific loan guarantees, which countries like Britain could well oppose since it could be seen as a bailout fund.
Specific measures will have to be approved by the time markets open today because vague promises have been unable to calm markets over the past weeks.
"We need to make progress today because when the markets are opening, we cannot afford disappointments," Swedish Foreign Minister Anders Borg said yesterday.
"We now see herd behaviors in the markets that are really pack behaviors, wolf pack behaviors," he said.
If unchecked, Borg said, "they will tear the weaker countries apart. So it is very important that we now make progress."
Some eurozone nations blamed the bloc's fragile governments and a lack of European cooperation for the crisis.
Underscoring the urgency, the European Commission was working out the details of the deal even before the meeting started.
"This is an important moment for both the Europeans and the others," said French Finance Minister Christine Lagarde.
Compounding the Greek financial crisis, attention has centered on fragile financial systems of countries like Spain and Portugal, which in turn could drag the whole of the eurozone further down.
"We have to take decisions that will restore the stability of the euro, for the eurozone and we have to work on the mechanism which will be comprehensive and efficient to restore stability," said Lagarde.
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