Italian Prime Minister Mario Monti is pushing to double the size of Europe's permanent bailout fund to one billion euros ($1.3 billion), a German media report to be published on Monday, Jan 23, said.
According to AFP, news weekly Der Spiegel said Monti wanted the planned 500-billion-euro European Stability Mechanism (ESM), which is scheduled to replace the European Financial Stability Facility(EFSF) in July, to have twice the firepower to help stricken states.
Der Spiegel, which did not cite its sources, said Monti argued that such a move would reassure markets while driving down borrowing costs for the debt-wracked countries of the eurozone.
"He has also informed the German government of his aims," it said.
Spiegel added that Monti had won backing for the proposal fromEuropean Central Bank President Mario Draghi, who it said proposed using unused money from the EFSF to boost the size of the new fund to about 750 billion euros.
A spokesman for Chancellor Angela Merkel on Friday again ruled out Berlin, the eurozone's paymaster, boosting its contributions to the European bailout funds.
