Euro zone bailouts getting harder to agree: policymakers

Sun Mar 24, 2013 2:39pm EDT
 
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By Ritsuko Ando

SAARISELKA, Finland (Reuters) - Euro zone bailouts are getting tougher to agree as opposition within creditor nations grows and indebted states struggle to persuade citizens to back austerity, policymakers said on Sunday.

At a meeting in Finnish Lapland this weekend, attendees including Ireland's Europe Minister Lucinda Creighton and host Prime Minister Jyrki Katainen sounded confident that Cyprus would secure a bailout deal to avoid financial collapse.

But they added the crisis was a reminder of the work needed to make sure EU member states stand by shared fiscal targets.

Toomas Hendrik Ilves, president of Estonia which joined the euro in 2011, said many saw bailouts as unfair.

"The result has been, over time, a decreasing willingness on the part of governments to go along with bailing out because their publics are not willing to go along with it, and so their parliaments are not going along with it," he said.

"It's going to get harder and harder to get things such as EFSF and ESM (bailout funds) passed in parliaments if we don't see more responsibility taken by those who need assistance."

In Finland, one of the few remaining countries in the euro zone to be rated triple-A by all major credit rating agencies, the anti-euro Finns Party has become a major opposition force, with voters viewing bailouts of countries such as Greece and Portugal as a reward for profligacy.

"When it's a union of values, it means that we have to have a strong sense of fairness," Katainen said. "One of the reasons we are in a crisis is that everybody did not follow the rules."   Continued...

 
(L-R) President of Estonia Toomas Hendrik Ilves, Finnish Prime Minister Jyrki Katainen and Prime Minister of Denmark Helle Thorning-Schmidt speak during a news conference after the informal Lapland meeting in Saariselka March 24, 2013. REUTERS/Sari Gustafsson/Lehtikuva