Euro zone finance ministers will discuss on Monday an increase in the effective lending capacity of the euro zone rescue fund, to draw a line under the sovereign debt crisis before more countries need help, according to Reuters.The rescue fund, the European Financial Stability Facility (EFSF), can borrow money on the market with euro zone government guarantees of up to 440 billion euros. But because it wants to have a triple A credit rating, the effective amount it can lend to countries in need is only around 250 billion. A potential bid for help from Portugal and Spain would stretch its resouces to the limit.The European Commission and the European Central Bank called last week for boosting the effective capacity of the EFSF as well as expanding its scope of operations. Germany, the biggest euro zone economy, is key to any agreement on changes. German Finance Minister Wolfgang Schaeuble Germany, signalled readiness to raise the effective capacity of the EFSF.'We have to and will solve this problem,' Schaeuble was cited as saying in the Frankfurter Allgemeine Sonntagszeitung. Also France appeared open to talks on an increase in the fund's lending capacity. But senior European sources told Reuters the sense of urgency in Berlin for boosting the fund had diminished after successful bond auctions last week in Spain and Portugal, the two countries seen most at risk of a bailout following rescues of Greece and Ireland last year.
