10may10

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EU aid fund to protect the euro from attacks, Merkel says

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German Chancellor Angela Merkel said Monday that a 750-billion-euro rescue package for eurozone members agreed on overnight would save the euro from sliding and fight speculations.

Europe's leaders were making "a concerted effort" to save the euro, Merkel told reporters in Berlin, hours after the European Union unveiled an unprecedented loan package worth of 750 billion euros (960 billion dollars), which was backed by the International Monetary Fund (IMF) and for eurozone countries facing instability troubles.

The package, which was hammered out after a 14-hour overnight meeting of Eropean financial chiefs, was "unique in history" and would "serve to strengthen and protect the common currency," Merkel said.

Under the rescue package, eurozone governments agreed to offer 440 billion euros in loans or guarantees, with 60 billion euros more from the EU's budget. The IMF pledged 250 billion euros for crisis-hit eurozone countries and the European Central Bank said it would buy government and private debt.

Merkel called on EU countries to act together to fight back "broad attacks" against the euro.

The chancellor also stressed that eurozone members should enforce strict austerity plans to "attack the problem at its roots". As Europe's leading economy, Germany would introduce its own austerity programs to maintain its debt at an appropriate level, she said.

"We are protecting the money of people in Germany," Merkel said. Her ruling party Christian Democrats (CDU) and alliance Free Democrats (FDP) lost in a crucial election of Germany's most populous state, North Rhine-Westphalia on Sunday, partly because of her widely unpopular bailout package for the debt-laden Greece.

On Monday, the euro rallied bly following the announcement of the EU rescue package. Jolted by the Greek fiscal crisis and soaring bond yields in Portugal and Spain, the euro last week plunged to its lowest level since March 2009.

[Source: Xinhua, Berlin, 10May10]

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