Brussels, 29/10/2012 (Agence Europe) - On Monday 29 October, Spanish prime minister Mariano Rajoy again rejected the idea of Spain requesting EU aid to help it roll over its debt at a lower interest rate on the financial markets. He said that a financial bailout was not necessary at this stage, but Spain would request one as and when it was necessary and beneficial for Spaniards. He was speaking after a Spanish-Italian summit in Madrid. Italian prime minister Mario Monti said that Italy was not planning to request activation of the European Stability Mechanism bailout fund in order to get the ECB to activate its special bond purchasing programme. In a statement, both leaders called for other tools to be put in motion to stimulate lending and economic growth.
Super-Commissioner for the euro. Rajoy and Monti were not exactly enthusiastic about the idea expressed by the head of the European Central Bank, Mario Draghi, in an interview in German magazine Der Spiegel, to give greater fiscal powers to the Euro Commissioner. Monti said it was a “myth” and Rajoy said it was only an “isolated measure.” The European Commission points out that some countries would have to change their constitutions to make this possible.
Unlike Germany, Spain and Italy are calling for direct and retroactive recapitalisation of struggling banks, which would also cover public bailouts made before the eurozone bank supervisory system is up and running. (MB/transl.fl)