Eurozone turns to IMF for more help in debt crisis
Dec-03-2011

Eurozone finance ministers turned to the IMF for more help to keep the monetary union together late Tuesday after they missed their goal of boosting their own bailout fund to one trillion euros.
With fears rising that Italy will need a bailout after its borrowing costs soared to record heights, ministers scrambled to tame a debt crisis threatening to break apart the 17-nation eurozone.
The ministers gave the rescue fund, the 440-billion-euro European Financial Stability Facility (EFSF), new weapons as part of efforts to increase its firepower but they were unable to give it a new headline figure.
"We haven't lowered our ambitions but the conditions have changed, so it will probably not be one trillion euros ($1.33 trillion) but less," Luxembourg Premier Jean-Claude Juncker, head of the group of eurozone finance ministers, told reporters.
The EFSF has helped Ireland and Portugal but is deemed too small to save Italy and Spain if the crisis brings these countries to their knees.
The ministers agreed to allow the fund to guarantee 20-30 percent of potential losses incurred by investors who buy bonds of governments in financial trouble. They also decided to create co-investment funds to allow public and private investors to participate in the EFSF.

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