|
|
Euro area policy-makers are counting on a beefed-up IMF to placate investors who have propelled yields on Spain’s 10-year bonds toward levels which trigged bailouts for Greece, Ireland and Portugal. They already agreed last month to boost their own defences to €800 billion.
That still falls short, said Canadian Finance Minister Jim Flaherty, who like US Treasury Secretary, Timothy Geithner, has declined to give more money to the IMF on the basis it has enough and Europe should do more. He proposed non-European countries be handed a veto over the role the lender can play assisting Europe.
European officials defended their actions as they arrived in the US capital. “The Europeans have done their part”, European Central Bank Executive Board member, Jörg Asmussen, said. “Now it’s up to our partners and this includes Canada and many other countries to increase the IMF resources.”
Europe has repeatedly failed to heed international lobbying to get ahead of its crisis. It underestimated the threat posed by Greece’s budget woes when they came to light in late 2009, and then the amount of cash required to contain the pain. Officials last month balked at a proposal to lift their firewall closer to €1 trillion, and Spain’s benchmark yield has jumped about 1 percentage point since early March, as Prime Minister Mariano Rajoy struggles to meet budget deficit targets.