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PM opposes increasing rescue fund

Prime Minister Jyrki Katainen is opposed to boosting the size of EU’s permanent rescue fund. Katainen's statements came after a meeting with German Finance Minister Wolfgang Schäuble, who was attending a meeting in Vantaa with the Finance Ministers of the Netherlands and Finland.

Prime Minister Jyrki Katainen.
Prime Minister Jyrki Katainen. Image: Yle

Katainen echoed the views expressed the day before by Finance Minister Jutta Urpilainen, who asserted that Finland does not support increasing the size of the European Union’s permanent bailout fund, the European Stability Mechanism or ESM.

According to Katainen, the Government was examining different options for boosting the efficiency of the bailout fund.

Katainen suggested considering whether the ESM or the temporary European Financial Stability Facility, the EFSF, could be used in such a way as to help keep nations in the market.

"I mean giving a small conditional loan to a country, which would not actually use this loan, but with this asset could go onto take loans of its own from the market," Katainen explained. According to the PM, such leverage measures could help to cut down the number of economic commitments of countries.

In his meeting with German Finance Minister Wolfgang Schäuble, Katainen discussed how to increase responsibility both on a national and European level.

"What is essential for the sake of business is that Europe is well and fairly integrated. However, nations must bear responsibility when it comes to basic economic matters," Katainen said.   

The Prime Minister revealed that one issue discussed was how much more power the EU Commission should be granted in order to make member states comply with their commitments.

In Katainen's view, Greece is in a bad situation, and forthcoming estimations by the EU Commission, the IMF and the European Central Bank would shed more light on the country’s economy.

The situation in Spain had calmed down in the last weeks, according to Katainen, who also praised the improvement of the Irish economy.  

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