Bloomberg News

Europeans Must Finance Any Bailout Fund, Australia’s Swan Says

October 26, 2011

Oct. 27 (Bloomberg) -- European officials must bear responsibility for any bailout fund to help end the region’s sovereign-debt crisis and stop “kicking the can down the road,” Australian Treasurer Wayne Swan said.

“It’s appropriate that the international community look at what resources the International Monetary Fund has available to it,” Australian Treasurer Wayne Swan told reporters today in Canberra. “But in the first instance, any bailout fund in Europe is a responsibility of the Europeans.”

French President Nicolas Sarkozy told reporters in Brussels today he estimates the euro region’s bailout fund will be worth $1.4 trillion after European governments agreed on steps to leverage existing guarantees by as much as five times.

The global economy has paid a high price for Europe’s failure to resolve the debt crisis and can’t afford any more “stumbles,” Swan said. He urged the region’s leaders to put together a comprehensive plan that includes a “war chest” to help rebuild confidence in markets, Swan said.

“The Europeans have been kicking the can down the road for the past 18 months,” said Swan, named last month as Euromoney magazine’s finance minister of the year. “So I think there’s a collective responsibility in Europe to deal with this.”

The Australian government has pledged to return the nation’s budget to surplus in 2013, an election year. The goal will be harder to achieve as the economy, the only one in the developed world to avoid a recession during the 2009 global downturn, is buffeted by international financial-market strains and weaker growth in trading partners.

Swan today reiterated the government’s intention to eliminate the nation’s budget deficit.

--Editors: Brendan Murray, Garfield Reynolds

To contact the reporter on this story: Michael Heath in Sydney at mheath1@bloomberg.net

To contact the editor responsible for this story: Stephanie Phang at sphang@bloomberg.net


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