Bloomberg News

Merkel Faces Opposition in Coalition to Boost Rescue Fund, Spiegel Reports

March 04, 2012

German Chancellor Angela Merkel may be prepared to increase the size of Europe’s permanent rescue fund, though she faces opposition from her junior coalition partner, the Christian Social Union, Der Spiegel reported.

Both Merkel and Finance Minister Wolfgang Schaeuble may be ready to bow to international pressure to increase the 500 billion-euro ($660 billion) European Stability Mechanism, the magazine reported today. Schaeuble recommends running the fund in parallel with its temporary predecessor, the European Financial Stability Facility, to create a 750 billion-euro fund, Spiegel reported, without citing anyone.

The proposal is opposed by the CSU, the Bavarian sister party of Merkel’s Christian Democrats, because the group views the 211 billion euros pledged by Germany to the temporary fund as the upper limit, Spiegel said.

To contact the reporter on this story: Brian Parkin in Berlin at bparkin@bloomberg.net

To contact the editor responsible for this story: James Hertling at jhertling@bloomberg.net


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