Schaeuble had warned us but the most skeptical continued to have doubts. However, the Eurogroup proved him right. Eurozone finance ministers have given the green light to the new European firewall which will amount, as announced by the German minister, to 800 billion euros. The document, approved today at the Copenhagen summit, underlines how the anti-crisis strategy carried out by Euroland "has worked" and that "now the markets are in better conditions".
So in July 2012 the ESM (European Stability Mechanism) will be created, or permanent state-saving fund, in which each member of the Eurozone will pay its own share, through the Eurozone which will advance them, for a total amount of 500 billion. To these the 200 billion of the temporary state-saving fund will add up, the EFSF (European Financial Stability Facility expiring in July 2013), already involved in the rescue packages for Greece, Ireland and Portugal. To these 700 billion another 53 billion is added, coming from bilateral loans already destined for Greece, and 49 billion coming from the European fund EFSM (European Financial Stability Mechanism), i.e. the financial stability fund of the 27-member Europe so far activated only for Ireland and Portugal. For this reason, in total we can speak of 800 billion euros.
Yet it is not as simple as it appears. Of these 800, 300 are practically already in use. Furthermore, the 500 billion will be introduced in three different times: the first tranches will be paid in 2013 and the final one in 2014. Therefore, to ensure full lending capacity for the ESM (500 billion), the Eurogroup established that until July 2013, the unused 240 billion of the EFSF will be at the disposal of the ESM, which will be able to use them only in cases of extreme urgency.
However, the president of the European Commission, Herman Van Rompuy, declared that at the next meeting of EU heads of state and government, scheduled for early May, "we will reassess the adequacy of the resources of the EFSF and ESM".
The statement about the Eurogroup decision made by the Austrian minister, Maria Fekter, to journalists before the press conference organized by the president of the Eurogroup, Jean-Claude Juncker, seems to have generated a diplomatic incident between the two.
