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EU billions salve against recession

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EU billions salve against recession

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European Union leaders have agreed to provide 75 billion euros in new loans to the International Monetary Fund, so that the IMF can help fight global recession. The idea is that other major world players will also add to this.

At a two-day summit the leaders also ramped up EU crisis assurance for struggling EU member states. Czech Prime Minister Mirek Topolanek, whose country currently holds the EU presidency, said: “The garantees for countries which have diffculties with the balance of payments have been increased to 50 billion euros. That is a doubling of the amount available — from 25 to 50. If there is a need to help a country which is particularly hit, now there is the possibility to do so!” Latvia and Hungary have already used some of this fund, and Romania is expected to. British Prime Minister Gordon Brown said the new loans to the IMF are for economic emergencies. He will host a summit in London of the Group of Twenty on April 2: “The financing gap for emerging countries this year is up to 800 billions, so it is not an issue just for emerging countries. Because of the risk of contagion, this is an issue for every country in the world. It is vital that we increase the resources available to the international institutions so that they can intervene to stop the crisis spreading, to stabilise economies, and return the global economy to growth.” Unlike the extra-trillion-dollar-spending US, the Europeans concluded: give existing recovery plans time to act, and exercise budgetary restraint.