Tags: EU | Europe | Financial | Crisis

Europe Agrees on Financing for Future Bailout Fund

Monday, 21 Mar 2011 02:19 PM

 

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Germany's finance minister says 17 states that use the euro have agreed on the financing of the eurozone's future bailout fund and slightly lowered the contributions for poorer states.

Wolfgang Schaeuble said Monday the eurozone members will give the European Stability Mechanism a capital base of 80 billion euros ($113.82 billion) and provide 620 billion euros ($882.14 billion) in callable capital, which has to be made available if a bailed out country looks unable to repay its loans.

That will give the ESM — which will come into force in mid-2023 — an effective lending capacity of 500 billion euros.

Schaeuble also said that the formula to calculate each state's contributions will be changed to give economic output more weight than population — slightly lowering the burden on poorer countries.

© Copyright 2014 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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