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EU ministers agree on euro defense package
EU economic ministers agree on package to defend euro


Buzz up! 0 Print..Topics:International.
French Finance Minister Christine Lagarde, right, greets Greek Finance Minister George Papaconstantinou during an emergency meeting of EU finance ministers in Brussels, Sunday, May 9, 2010. EU finance ministers meet in Brussels Sunday to discuss establishing a new "stabilisation mechanism" to prevent the Greek debt crisis from spreading. (AP Photo/Virginia Mayo)
Raf Casert and Elena Becatoros, Associated Press Writer, On Sunday May 9, 2010, 9:11 pm
BRUSSELS (AP) -- European Union finance ministers agreed Monday on a euro750 billion EU and International Monetary Fund safety net for troubled eurozone countries, hoping it will keep markets from targeting the weaker members of the 16 countries that use the embattled euro.

Under the three-year aid plan, the EU Commission will make euro60 billion ($75 billion) available while countries from the 16-nation eurozone would promise bilateral backing for euro440 billion ($570 billion). The IMF would contribute an additional sum of at least half of the EU's total contribution, or euro250 billion, Spanish Finance Minister Elena Salgado said.

The EU's monetary affairs commissioner, Olli Rehn, said the agreement "proves that we shall defend the euro whatever it takes."

The agreement was reached after marathon 11-hour talks in an emergency finance ministers' meeting hastily convened Sunday amid concerns that the financial crisis sparked by Greece's runaway debt problems had begun to spread to other financially troubled eurozone countries such as Portugal and Spain.

"We are facing such exceptional circumstances today and the mechanism and the mechanism will stay in place as long as needed to safeguard financial stability," the ministers said in a statement.

Spain and Portugal, which have begun to see the same signs of trouble that Greece had three months, have committed to "take significant additional consolidation measures in 2010 and 2011," the statement said, and the two countries will present them to the EU's finance ministers at their meeting on May 18.