BRUSSELS - The euro zone enhance the capacity of the combined power of bailout loans to close to 700 billion euro from 500 billion in trade-off between the German opposition to earn more money and dominate the market, the euro zone officials said.
Euro zone finance ministers and central bank governors will conduct the discussion of the size of their bailout funds, the European Financial Stability Facility (EFSF) and permanent European Stability Mechanism (ESM) in Copenhagen on 30-31 March. The EFSF and ESM 440000000000 € 500 billion now have a combined loan of 500 billion euro, which means that for 12 months from July 2012 they cannot lend more than 500 billion euro together.
The market supports a higher capacity for lending to euro zone 17-nation bloc to ensure sufficient funds to save even a large member like Italy or Spain, but Germany has been adamantly opposed. Of the total 440 billion euro fund for loans, EFSF plans to allocate € 192 billion bailout for Greece, Ireland and Portugal.
"The capacity of the combined loans is estimated at 500000000000-692000000000, around 700 billion. It's one of the options being discussed is perhaps the most ambitious and because it is politically the easiest," the official said. A second euro zone officials warned this is a possible solution, although both are assessing several options are being examined and the final outcome is still unclear.