EFSF head calls for longer term European rescue fund

23rd September 2010, Comments 0 comments

The head of the European Financial Stability Facility, designed to help debt-laden eurozone countries, called Thursday for a longer-term facility associated with strict conditions.

"I think we need a mechanism for emergency cases," EFSF Klaus Regling told a forum organised in Berlin by the British magazine The Economist.

He added that any new body should be subject to "strict conditions" regarding its use.

The EFSF was created in May at the height of the eurozone debt crisis and is to exist for three years, tasked with raising funds on equity markets on behalf of countries that cannot access such markets directly at reasonable rates.

A so-called special purpose vehicle (SPV), it is based in Luxembourg and has been granted authority to raise up to 440 billion euros (585 billion dollars) by issuing bonds guaranteed by eurozone member countries with solid credit ratings.

© 2010 AFP

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