Brussels, 20/12/2011 (Agence Europe) - The 17 eurozone nations confirmed on Monday 19 December that they will be providing the International Monetary Fund (IMF) with an extra €150bn in the form of loans from individual countries. Germany will provide €41.5bn (26.67% of the eurozone total), France €31.4bn, Italy €23.48bn, Spain €14.86bn, the Netherlands €13.61bn, Belgium €9.99bn, Austria €6.13bn, Finland €3.76bn, Luxembourg €2.06bn, Slovakia €1.56bn, Slovenia €0.91bn, Cyprus €0.48bn and Malta €0.26bn.
Several non-euro countries have agreed to support the IMF aid mechanism. Poland is planning to provide €6bn, Sweden up to 100 billion Swedish crowns (€11bn), Denmark €5.4bn and the Czech Republic €3.5bn, but after the publication of a press release, the Czech deputy finance minister said that no decisions had yet been taken.
Semi-formal commitment was made at the 9 December European Council, “to be confirmed within ten days”. On Monday evening, after a three hour video conference, the Eurogroup finance ministers were able to reach agreement.
The United Kingdom has refused to join the other countries in adding to the IMF's coffers, withdrawing its initial plan of €30bn. The UK's opposition makes is much more difficult to meet the target of €200bn extra funding for the IMF.
In a press release, Jean-Claude Juncker, the chair of the Eurogroup, said: “The EU would welcome G20 members and other financially strong IMF members supporting the efforts to safeguard global financial stability by contributing to the increase in IMF resources so as to fill global financing gaps.”
The agreement is one stage in the process of safeguarding the eurozone. Two months after its announcement had an impact, the EFSF backstop (European Financial Stability Fund) is still waiting for the €1 trillion announced at the 26 July October European Council. The European Stability Mechanism (ESM), seen as a possible European Monetary Fund, is seeing its future shareholders attack each other over the extra €500bn expected by the summer, squabbling over whether this should come in a single payment (Luxembourg's idea) or in several stages (Germany's ideal).
On Monday, the ECB said it was not planning any cure-alls, which the EU treaty forbids it from doing. Mario Draghi said the solution lay in restoring budget discipline, reforms to kick-start growth and, above all, a fully equipped and operational backstop. The president of the ECB said he was in no doubt that the euro was here to say, but regretted the way Europe had twice taken the bull by the wrong end of the horns - firstly by deciding on a write-down of Greek debt before recapitalising the banks, and secondly by deciding to recapitalise the banks before introducing a credible backstop. (LC/transl.fl)