Brussels, 27/02/2011 (Agence Europe) - The decision on increasing the resources of the European anti-crisis firewall will be made in the month of March, not at the European Spring Council (Thursday 1 and Friday 2 March), the president of the European Commission, José Manuel Barroso, announced on Monday 27 February. First of all, Barroso warned that it was unlikely that an agreement would be reached on combining the future European Stability Mechanism (ESM) with the remaining fighting funds of the European Financial Stability Facility (EFSF), despite considerable pressure brought to bear by the finance ministers of the G20 (see other article). With Germany alone in its defensive position, which consists of denying the need to combine the two rescue funds (see EUROPE 10560), the Commission president stated another explanation for the current blockage: sufficient hindsight is needed to observe the repercussions of the latest decisions made on the second bailout for Greece.
The absence of a swift agreement on strengthening the firewall could increase the impatience of the non-European members of the G20, who on Sunday 26 February made the increase of the resources of the International Monetary Fund conditional on the creation of a tougher European mechanism to counter any possibility of the crisis spreading. However, after Barroso's intervention at the conference “The EUROPE 2020 Summit: Unleashing growth and creating jobs”, organised by the Lisbon Council, the next two speakers presented radically diverging points of view on this issue, despite a common position on the urgency of the need for a firewall. In the view of Lucio Vinhas de Souza, director-general of the rating agency Moody's, the uncertainty over the final aspect of the European firewall and the resources it will have is currently one of the major problems, which brings with it the risk of growing mistrust towards the EU's capacity to manage the crisis. The disagreement with chief economist of the Lisbon Council, Alessandro Leipold, came when the question was raised as to whether the EU should resolve its own problems itself. Although de Souza replied in the affirmative, Leipold feels that given the strong interdependence between the principal international economies, the eurozone is not the best platform for a sharing of the risks. A systematic crisis can be resolved only with the intervention of an external player such as the IMF, which would be the only body capable of providing effective coordination, he explained. (JK/transl.fl)