Germany votes for expansion of bailout fund

PanARMENIAN.Net - Removing another significant obstacle in the European debt crisis, the German Parliament voted overwhelmingly on Thursday, September 29, for the expansion of the bailout fund for heavily indebted European countries.

By passing the measure, Germany promised to increase its share of the loan guarantees to 211 billion euros, or about $287 billion, from 123 billion euros, as agreed by national leaders in Brussels back in July. Under the euro zone’s tortuous procedures, however, all 17 European Union countries that use the euro must approve the agreement, a process that has revealed ever more fissures, layers of decision-making and political complexity that add up to a worrisome inability to react quickly and decisively to upheaval in fast-moving financial markets.

Analysts have already said that the fund, even if it passes in all 17 countries, will probably be too small to defend against speculative attacks on deeply indebted European nations. Nevertheless, although the German vote perhaps offered nothing more than momentary relief, it was the crucial step to move the fight forward to the next stage, The New York Times reported.