COPENHAGEN — The 17 countries that use the euro have boosted their emergency funding for heavily indebted countries to $1.1 trillion — an amount that falls short of what the currency union’s international partners had said is needed to calm financial markets.
Of the $1.1 trillion limit eurozone finance ministers agreed to Friday, only some $670 billion is still available for new bailout loans. About $400 billion in loans have already been used to bail out Greece, Ireland and Portugal.
The International Monetary Fund and others have been calling for a financial “firewall” of more than $1.3 trillion — just in case the much larger economies of Spain and Italy need assistance. On Friday, IMF managing director Christine Lagarde congratulated European leaders on their agreement but didn’t say whether it went far enough to guarantee additional help from the IMF.
“I welcome the decision of euro area ministers to strengthen the European firewall,” Lagarde said in a statement. “The IMF has long emphasized that enhanced European and global firewalls, together with the implementation of strong policy frameworks, are critical for ending the crisis and securing international financial stability.”
The U.S. Treasury Department also didn’t say whether the firewall was as large as it had hoped.
