German chancellor Angela Merkel has won backing from enough parliamentarians in Berlin to approve new powers for, and an expansion of, the eurozone's bailout fund.
German chancellor Angela Merkel has won backing from enough parliamentarians in Berlin to approve new powers for, and an expansion of, the eurozone’s bailout fund.
The bill was passed, as widely expected before this morning’s vote in Berlin. Some 523 in the Bundestag voted in favour, with 85 against and three abstentions.
The political support came despite opinion polls suggesting up to 75% of Germans oppose expanding the EFSF.
Early indications suggested most ‘no’ votes came from the left wing parties.
If Merkel had faced more than 19 ‘no’s’ from her own CDU party, she had to rely on support from elsewhere still to win the ballot.
However, approval must first be won in all 17 member states for the powers to take effect.
France, Italy and Spain all voted in favour yesterday. Seven more countries are still to vote. Finland approved expansion this week, while Austria votes on Friday.
If full eurozone-wide approval follows today’s outcome in Berlin, the German contribution to the Luxembourg-based fund can grow to €211bn, from €123bn, or about 27% of the total now.
In addition, the fund will win powers to buy bonds in secondary markets, enable bank recapitalizations and offer precautionary credit lines.
Germany’s ballot reflects confidence from the CDU’s chief whip Peter Altmeier this morning. Speaking to the BBC he said: “As a chief whip, I have to be optimistic, but so far we have managed to win every single struggle in parliament, every single vote and that is going to happen again this Thursday.”
Finance minister Wolfgang Schäuble promised lawmakers all alterations to the fund, and Germany’s involvement, would need to be approved by parliament. He also said Europe faced an “extraordinarily difficult situation,” and Germany must be “an anchor of stability in Europe”.
The euro rallied briefly after the result, and stock markets in Germany and France are up mildly on the day.
The vote came on another busy day for European politics. In Warsaw the EU is holding a summit, eurozone consumer confidence data was due out and more strikes were widely expected in Greece. Independent inspectors in Athens are starting to review if the administration has acted far enough to earn its next €8bn in central aid.
In the Bundestag debate, Merkel stressed Greece might still not qualify for the next package if it does not meet austerity targets.
Rainer Brüderle, leader of the FDP parliamentary group, part of Merkel’s ruling coalition, said: “When money goes bad, everything goes bad. Germany experienced this in its history – from hyperinflation and mass poverty to war.”
But Jürgen Trittin, head of the Greens, said Merkel’s “zigzag course [in the crisis] had worsened the crisis”.