News / Europe

IMF's Lagarde Calls for Eurozone Debt Sharing

International Monetary Fund managing director Christine Lagarde (L) speaks at a news conference at the Treasury in London, May 22, 2012.
International Monetary Fund managing director Christine Lagarde (L) speaks at a news conference at the Treasury in London, May 22, 2012.
VOA News
The chief of the International Monetary Fund is calling for the 17-nation euro currency bloc to accept more liability for each others' debts, but economic powerhouse Germany says it remains adamantly opposed to selling joint eurozone bonds.

IMF Managing Director Christine Lagarde told a London news conference Tuesday that with the economy contracting in the eurozone, more needs to be done to boost its growth and that wealthier countries need to share the burden with their debt-ridden neighbors.

"We consider that more needs to be done, particularly by way of fiscal liability sharing and there are multiple ways to do that," she said. "More needs to be done in relation to supporting growth, particularly by way of structural reforms, certainly not by way of, you know, suggested stimulus because we do not think that the fiscal position of the member states can actually bear that on an aggregate basis."

"So, there is still work under way but we certainly hope that the monetary zone that has been built for the last ten years will continue to be developed, to be strengthened and that the political will of the members will actually be conducive to that effect," she added.

The Organization for Economic Cooperation and Development, representing 34 of the world's largest economies, also called for selling joint bonds. The OECD slashed its forecast for the eurozone economy, predicting it would contract this year by one-tenth of a percentage point, down from the meager two-tenths of a percent growth it had earlier projected.

New French President Francois Hollande is expected to push for the sale of eurobonds when the European Union's 27 leaders meet in Brussels Wednesday.

But Germany, with the eurozone's strongest economy, and other wealthier, northern European countries have been staunchly opposed to such joint financing of eurozone debt. They are fearful that their low borrowing costs would increase sharply if they also were responsible for financing debt-ridden Greece, Italy, Spain and other financially troubled countries.

A senior German official told reporters in Berlin that eurobonds "cannot be part of a growth package."

Austrian Finance Minister Maria Fekter called Hollande's approach "nonsense." She described economic growth financed by more debt "a recipe from the day before yesterday."

 

Some information for this report was provided by AP.

You May Like

Photogallery US to Send 3,000 Troops to Liberia in Expanded Ebola Effort

At US Centers for Disease Control and Prevention in Atlanta, Obama is to announce troop deployment, other details of US plans to fight Ebola outbreak More

China Muslims Work to Change Perceptions After Knife Attacks

Muslims in Kunming say that they condemn the violence, it is not a reflection of the true beliefs of their faith More

Humanitarian Aid, Equipment Blocked in Cameroon

Move is seen as a developing supply crisis in West Africa More

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
Enviropreneur Seeks to Save the Environment, Empower the Communityi
X
September 16, 2014 2:06 PM
Lorna Rutto, a former banker, is now an ‘enviropreneur’ - turning plastic waste into furniture and fences discusses the challenges she faces in Africa with raw materials and the environment.
Video

Video Enviropreneur Seeks to Save the Environment, Empower the Community

Lorna Rutto, a former banker, is now an ‘enviropreneur’ - turning plastic waste into furniture and fences discusses the challenges she faces in Africa with raw materials and the environment.
Video

Video West Trades Accusations Over Ransoms

As world leaders try to forge a common response to the threat posed by Islamic State militants in Iraq and Syria, there is simmering tension over differing policies on paying ransoms. In the past month, the jihadist group has beheaded two Americans and one Briton. Both countries refuse to pay ransom money. As Henry Ridgwell reports for VOA from London, there is uncertainty in the approach of some other European nations.
Video

Video Scotland Independence Bid Stokes Global Interest

The people of Scotland are preparing to vote on whether to become independent and break away from the rest of Britain, in a referendum being watched carefully in many other countries. Some see it as a risky experiment; while others hope a successful vote for independence might energize their own separatist demands. Foreign immigrants to Scotland have a front row seat for the vote. VOA’s Henry Ridgwell spoke to some of them in Edinburgh.
Video

Video Washington DC Mural Artists Help Beautify City

Like many cities, Washington has a graffiti problem. Buildings and homes, especially in low-income neighborhoods, are often targets of illegal artwork. But as we hear from VOA’s Julie Taboh, officials in the nation's capital have come up with an innovative program that uses the talents of local artists to beautify the city.
Video

Video US Muslim Leaders Condemn Islamic State

Leaders of America's Muslim community are condemning the violent extremism of the Islamic State group in Iraq and Syria. The U.S. Muslim leaders say militants are exploiting their faith in a failed effort to justify violent extremism. VOA correspondent Meredith Buel reports.
Video

Video Americans' Reaction Mixed on Obama Strategy for Islamic State Militants

President Barack Obama’s televised speech on how the United States plans to “degrade and destroy” the group known as the Islamic State reached a prime-time audience of millions. And it came as Americans appear more willing to embrace a bolder, tougher approach to foreign policy. VOA producer Katherine Gypson and reporter Jeff Seldin have this report from Washington.
Video

Video Authorities Allege LA Fashion Industry-Cartel Ties

U.S. officials say they have broken up crime rings that funneled tens of millions of dollars from Mexican drug cartels through fashion businesses in Los Angeles. Mike O'Sullivan reports that authorities announced nine arrests, as 1,000 law enforcement agents fanned out through the city on Wednesday.
Video

Video Bedouin Woman Runs Successful Business in Palestinian City

A Bedouin woman is breaking social taboos by running a successful vacation resort in the Palestinian town of Jericho. Bedouins are a sub-group of Arabs known for their semi-nomadic lifestyle. Zlatica Hoke says the resort in the West Bank's Jordan Valley is a model of success for women in the region.


Carnage and mayhem are part of daily life in northern Nigeria, the result of a terror campaign by the Islamist group Boko Haram. Fears are growing that Nigeria’s government may not know how to counter it, and may be making things worse. More

AppleAndroid