BERLIN (MNI) – The German government’s share in the financing of
the EU aid plan to stabilize the euro might surpass the agreed
distribution table if not all the Eurozone states contribute, government
spokesman Ulrich Wilhelm said Monday.

EU finance ministers agreed early Monday on a special fund to raise
up to E440 billion over three years to aid fiscally troubled member
states, Wilhelm noted. Eurozone countries are to guarantee the loans and
the amount each country has to guarantee will be calculated based on its
share in the capital of the ECB, he said.

However, “there exists the possibility that not every state will be
able to participate in these bilateral guarantees,” the spokesman
pointed out. Thus, the share of loans Germany will have to guarantee
might rise, he said.

The spokesman declined to estimate how much Germany might have to
stand in for in the end, given that it is unclear how much of the
offered loans will be really called upon.

Finance Ministry spokesman Martin Kreienbaum stressed that these
loans were not joint eurobonds, but rather bilaterally guaranteed loans
raised by a special purpose vehicle.

By using this method, the EU was not going down the road of a
“transfer union,” Wilhelm asserted.

The government spokesman noted that EU finance ministers also
agreed to “come to swift decisions” on further regulation of short
selling and the trade of derivatives. Excessive speculation on financial
markets needs to be reigned in, he said.

In other remarks, Wilhelm stressed that there is no question about
Finance Minister Wolfgang Schaeuble’s ability to fulfill his ministerial
duties. “Such doubts do not exist,” he said.

Schaeuble was taken to a hospital in Brussels on Sunday after
experiencing problems with new medication. Kreienbaum said the minister
is to leave the hospital at around noon. Schaeuble has been confined to
a wheelchair after having been shot by a mentally disabled man in 1990.

–Berlin bureau: +49-30-22 62 05 80; email: twidder@marketnews.com

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