Tags: Eurozone | Private | Sector | Involvement

Eurozone Mulls End to Future Private Sector Involvement

Friday, 25 Nov 2011 10:05 AM

Eurozone member states are discussing dropping private sector involvement from the permanent bailout mechanism that is due to come into force in 2013, four EU officials said on Friday.

The discussions are taking place as part of wider negotiations over changing the EU treaty to introduce stricter fiscal rules as Germany wants.
Germany insisted that private sector investors -- banks and insurance companies -- bear a portion of the losses in the bailout of Greece. Eurozone states originally agreed to include clauses in the permanent bailout fund, the European Stability Mechanism (ESM), that would enforce private sector involvement.

But the majority of the eurozone's 17 countries now want those clauses removed from the ESM and there is movement toward that happening, the sources said.

"France, Italy, Spain and all the peripherals" are in favor of removing the clauses, one EU official told Reuters. "Against it are Germany, Finland and the Netherlands."

Others said that while German insistence on retaining the clauses was fading, they would only be removed as part of a broader negotiation over changes to the EU treaty. Berlin wants full backing for changes to the treaty before it moves on other areas where member states want it to soften its stance, the officials said.



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Economy
Eurozone member states are discussing dropping private sector involvement from the permanent bailout mechanism that is due to come into force in 2013, four EU officials said on Friday. The discussions are taking place as part of wider negotiations over changing the EU...
Eurozone,Private,Sector,Involvement
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2011-05-25
Friday, 25 Nov 2011 10:05 AM
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