News

    Europe Ministers Reach Deal on Trillion-Dollar 'Firewall'

    European Central Bank President Mario Draghi, takes his seat  during  the informal EU-meeting for EU Finance Ministers, in Copenhagen, Denmark, March 30 2012.
    European Central Bank President Mario Draghi, takes his seat during the informal EU-meeting for EU Finance Ministers, in Copenhagen, Denmark, March 30 2012.

    European ministers meeting in Copenhagen have agreed to create a permanent fund for the eurozone to help it recover from its debt crisis with temporary lending capacity of more than $1 trillion. The eurozone nations are working to ensure that the economic crisis does not spill over into Spain and Italy.

    It is the most recent step taken by Europe to show the markets that they can cope with the economic crisis hitting a number of its member states.

    The decision means that a financial rescue fund (firewall) worth around $1 trillion will be available for future loans.

    In a statement, the group of 17 finance ministers said that finally “robust firewalls have been been established.”

    Earlier in the day, European Union Economics Minister Olli Rehn said Europe has made a lot of progress towards safeguarding its economies. "We have made significant progress in the recent weeks and months in terms of fiscal consolidation and in terms of reinforcing our economic governance," he said. "Now it is time to complete the crisis response by further reinforcement of the euro area financial firewall."

    But going into the talks, there was some controversy about the size of the emergency fund.

    The eurozone’s largest economy, Germany, has been averse to raising the bar so high. France, on the other hand, has been more forthcoming.

    French Finance Minister Francois Baroin said the higher the firewall, the greater the deterrence against instability in the markets.

    What Europe’s ministers ended with was a hike -- but analysts say it may not be enough to calm the markets.

    Earlier this week, the Organization for Economic Cooperation and Development said the bailout fund should be raised to $1.3 trillion -- more than Friday’s agreed sum. The fund was previously worth around $650 billion.

    The new figure was partly reached by combining money already pledged into one fund.
    Austrian Finance Minister Maria Fekter told reporters that the eurozone is now much stronger than it was a few months ago.

    Simon Tilford is chief economist at the Center for European Reform, a London-based research group that campaigns for European integration.

    He says Europe’s reaction to its economic crisis is not working. What is needed, he says, is a federalized system where resources cross borders more freely.

    "I think what needs to happen is that the governments need to accept that a currency union requires a much closer degree of integration than they have been hitherto prepared to acknowledge. So they need some kind of federal budget -- the kind of federal budget that effectively transfers funds between the states of the U.S., for example." said Tilford.

    Spain’s government is set to reveal a new 2012 budget Friday that is expected to make billions of dollars in cuts.

    On Thursday, workers went on strike across Spain to protest the cuts, high unemployment rates and new labor laws.

    The Spanish government insists it will not need to be bailed out by its euro neighbors. Speaking in Copenhagen Friday, Spain’s economy minister said the new Spanish budget will convince euro leaders and the markets that Spain can cope with its debts and create growth in the Spanish economy.

    This forum has been closed.
    Comments
         
    There are no comments in this forum. Be first and add one

    Featured Videos

    Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
    Slow Rebuilding Amid Boko Haram Destruction in Nigeria’s Northeasti
    X
    June 29, 2016 6:15 PM
    Military operations have chased Boko Haram out of towns and cities in Nigeria’s northeast since early last year. But it is only recently that people have begun returning to their homes in Adamawa state, near the border with Cameroon, to try to rebuild their lives. For VOA, Chris Stein traveled to the area and has this report.
    Video

    Video Slow Rebuilding Amid Boko Haram Destruction in Nigeria’s Northeast

    Military operations have chased Boko Haram out of towns and cities in Nigeria’s northeast since early last year. But it is only recently that people have begun returning to their homes in Adamawa state, near the border with Cameroon, to try to rebuild their lives. For VOA, Chris Stein traveled to the area and has this report.
    Video

    Video Clinton Leads Trump, But Many Voters Don't Like Either

    In the U.S. presidential race, most recent polls show Democrat Hillary Clinton with a steady lead over Republican Donald Trump as both presumptive party nominees prepare for their party conventions next month. Trump’s disapproval ratings have risen in some recent surveys, but Clinton also suffers from high negative ratings, suggesting both candidates have a lot of work to do to improve their images before the November election. VOA National correspondent Jim Malone has more from Washington.
    Video

    Video New US Ambassador to Somalia Faces Heavy Challenges

    The new U.S. envoy to Somalia, who was sworn into office Monday, will be the first American ambassador to that nation in 25 years. He will take up his post as Somalia faces a number of crucial issues, including insecurity, an upcoming election, and the potential closure of the Dadaab refugee camp in Kenya. VOA’s Jill Craig asked Somalis living in Kenya’s capital city Nairobi how they feel about the U.S. finally installing a new ambassador.
    Video

    Video At National Zoo, Captivating Animal Sculptures Illustrate Tragedy of Ocean Pollution

    The National Zoo in Washington, D.C., is home to about 1,800 animals, representing 300 species. But throughout the summer, visitors can also see other kinds of creatures there. They are larger-than-life animal sculptures that speak volumes about a global issue — the massive plastic pollution in our oceans. VOA's June Soh takes us to the zoo's special exhibit, called Washed Ashore: Art to Save the Sea.
    Video

    Video Baghdad Bikers Defy War with a Roar

    Baghdad is a city of contradictions. War is a constant. Explosions and kidnappings are part of daily life. But the Iraqi capital remains a thriving city, even if a little beat up. VOA's Sharon Behn reports on how some in Baghdad are defying the stereotype of a nation at war by pursuing a lifestyle known for its iconic symbols of rebellion: motorbikes, leather jackets and roaring engines.
    Video

    Video Melting Pot of Immigrants Working to Restore US Capitol Dome

    The American Iron Works company is one of the firms working to renovate the iconic U.S. Capitol Dome. The company employs immigrants of many different cultural and national backgrounds. VOA’s Arman Tarjimanyan has more.
    Video

    Video Testing Bamboo as Building Material

    For thousands of years various species of bamboo - one of the world's most versatile plants - have been used for diverse purposes ranging from food and medicine to textiles and construction. But its use on a large scale is hampered because it's not manufactured to specific standards but grown in the ground. A University of Pittsburgh professor is on track to changing that. VOA’s George Putic reports.
    Video

    Video Orphanage in Iraqi City Houses Kids Who Lost their Parents to Attacks by IS

    An orphanage in Iraqi Kurdistan has become home to scores of Yazidi children who lost their parents after Islamic State militants took over Sinjar in Iraq’s Nineveh Province in 2014. Iraqi Kurdish forces backed by the U.S. airstrikes have since recaptured Sinjar but the need for the care provided by the orphanage continues. VOA’s Kawa Omar filed this report narrated by Rob Raffaele.
    Video

    Video Re-Opening Old Wounds in a Bullet-Riddled Cultural Landmark

    A cultural landmark before Lebanon’s civil war transformed it into a nest of snipers, Beirut’s ‘Yellow House’ is once again set to play a crucial role in the city.  Built in a neo-Ottoman style in the 1920s, in September it is set to be re-opened as a ‘memory museum’ - its bullet-riddled walls and bunkered positions overlooking the city’s notorious ‘Green Line’ maintained for posterity. John Owens reports from Beirut.
    Video

    Video Brexit Resounds in US Presidential Contest

    Britain’s decision to leave the European Union is resounding in America’s presidential race. As VOA’s Michael Bowman reports, Republican presumptive nominee Donald Trump sees Britain’s move as an affirmation of his campaign’s core messages, while Democrat Hillary Clinton sees the episode as further evidence that Trump is unfit to be president.
    Video

    Video NASA Juno Spacecraft, Nearing Jupiter, to Shed Light on Gas Giant

    After a five-year journey, the spacecraft Juno is nearing its destination, the giant planet Jupiter, where it will enter orbit and start sending data back July 4th. As Mike O'Sullivan reports from Pasadena, California, the craft will pierce the veil of Jupiter's dense cloud cover to reveal its mysteries.
    Video

    Video Orlando Shooting Changes Debate on Gun Control

    It’s been nearly two weeks since the largest mass shooting ever in the United States. Despite public calls for tighter gun control laws, Congress is at an impasse. Democratic lawmakers resorted to a 1960s civil rights tactic to portray their frustration. VOA’s Carolyn Presutti explains how the Orlando, Florida shooting is changing the debate.

    Special Report

    Adrift The Invisible African Diaspora