EU creates 500 billion-euro fund for crisis-hit eurozone members by Magdalena Rosova

Germany wants European union to create an emergency fund of 500 billion euros to help countries in the eurozone which are hit by crisis. Germany hopes this step would reassure markets about the common currency. The dramatic bid was announced on Sunday, just few hours before Asia-Pacific markets open. The plan has also “complete agreement” from France. The proposal followed urgent telephone calls between US President Barack Obama, German Chancellor Angela Merkel and French President Nicolas Sarkozy. European union is trying to reassure the world about the stability of euro. Angela Merkel was pressed to come up with the emergency fund, after her coalition lost majority in the upper German house, because voters were angry about the 110-billion-euro bailout for Greek. It was the fattest cheque in history of EU. Chaos has already hit markets in Portugal and Spain. Germany is desperately trying to prevent its spreading further and to rebuild confidence on market! s. The money from the fund should be available to threatened members of the eurozone. The fund would consist from 440 billion euros from eurozone countries and the International Monetary Fund. 60 billion euros of loan funds would come from the European Commission. European finance ministers are holding long talks in Brussels. If the plan succeeded, it would be the unprecedented bailout in public finance history. After shares tumbled across the globe last week, Sarkozy told Paris and Berlin will try to find the best way to resolve the financial crisis. Spanish Finance Minister Elena Salgado, who is chairing the talks about the crisis in EU, affirmed they would do whatever is necessary.

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by Magdalena Rosova for Ca! ntell TV (http://cantell.tv)

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