Angela Merkel heads EU bail-out fund restructuring
The €500bn eurozone bail-out fund has been restructured to slow cash payments.
German Chancellor Angela Merkel fostered agreement for a restructuring of the €500bn eurozone bail-out fund which will ensure that members don't have to inject cash into the system too quickly.
The original agreement was for €40bn to be paid into the fund immediately upon its creation in 2013 with the rest coming in over the course of three years. The Free Democrats, Merkel's coalition partners, however objected to paying in so much so quickly.
The new fund will cost €80bn over five years - €16bn per year - plus €650bn in guarantees and callable capital. This will then be used to bail-out countries in severe debt.
Countries like Spain and Italy were unhappy with the agreement, which allows for countries with better credit records to make additional loan guarantees, while those with poorer records, such as themselves, would have pay more in cash upfront.