German Finance Minister suggests increasing EU's bailout fund to $1.38 trillion

PanARMENIAN.Net - German Finance Minister Wolfgang Schaeuble has suggested the firepower of the EU's bailout fund could be increased to one trillion euros ($1.38 trillion), AFP said citing an Oct.19 report in the Financial Times Deutschland .

Europe is looking for ways of boosting the firepower of the European Financial Stability Facility (EFSF) because experts believe the 440-billion-euro fund is too small to prevent the eurozone debt crisis from spreading.

Nevertheless, German politicians are concerned that the contribution of Germany, effectively the European Union's paymaster, will have to be increased to beyond the 211 billion euros agreed.

But Schaeuble has assured members of the ruling liberal and conservative coalition that that will not be the case, FT Deutschland reported, quoting unnamed sources.

It said the fund could be leveraged to offer partial insurance of 20-30 percent should member countries not be able to repay their sovereign debt.

The partial insurance coverage would enable eurozone countries to borrow more on the capital markets, the newspaper said.