Germany’s parliament has voted to approve Berlin’s contribution to an EU bailout for Spanish banks.
But the Bundestag ballot, which was widely expected to pass, was won despite deep worries over the rising costs to Germany of hundreds of billion euros in financial aid to its Mediterranean neighbours.
Finance Minister Wolfgang Schaueble defended Berlin’s support for Spain: “Without the extreme insecurity of the financial markets, Spain would be in the position to resolve the crisis in its banking sector on its own.
“But we are in exceptional circumstances and because of these, we are helping Spain to combat the exaggerated nervousness of the markets and can also contribute to financial stability in the entire eurozone,” Schaueble added.
Last month 26 MPs from the ruling coalition voted against the ratification of the wider bailout fund known as the European Stability Mechanism.
Europe’s largest economy will guarantee almost 30 percent of the Spanish bank bailout worth up to 100 billion euros.