France favourable to China aid for eurozone: source

26th October 2011, Comments 0 comments

France is in favour of China taking part in efforts to stem the eurozone debt crisis by helping boost its bailout resources, a senior government source said Wednesday.

President Nicolas Sarkozy "is favourable to their participation" and will telephone Chinese President Hu Jintao on Thursday to discuss the issue, the source said on the sidelines of a eurozone summit in Brussels late Wednesday.

Senior EU diplomats said earlier that China agreed to participate in plans to boost the firepower of the eurozone's debt crisis firewall.

Russia also voiced interest but said it would contribute through an International Monetary Fund scheme rather than directly through the eurozone's European Financial Stability Facility (EFSF).

Eurozone leaders were holding talks Wednesday to find ways to beef up the EFSF, but without increasing the individual contributions provided by governments.

Two options are being considered.

One would allow the EFSF to insure part of the debt of weak countries to convince investors to keep buying their bonds.

The other option would see the creation of a "special purpose investment vehicle" linked to the EFSF through which private and public investors could contribute. An alternative would be for these contributions to be made through an IMF scheme.

© 2011 AFP

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