China's Wen: May consider bigger role in EU rescue

Thu Feb 2, 2012 6:00pm EST
 
Email This Article |
Share This Article
  • Facebook
  • LinkedIn
  • Twitter
| Print This Article | Single Page
[-] Text [+]

By Lucy Hornby and Andreas Rinke

BEIJING (Reuters) - China is considering increasing its participation in the rescue funds aimed at resolving the European debt crisis, Chinese Premier Wen Jiabao told journalists on Thursday.

But Wen did not make any explicit financial commitments for the European Financial Stability Facility (EFSF) or the upcoming European Stability Mechanism (ESM).

At a joint media briefing in Beijing with visiting German Chancellor Angela Merkel, Wen said China is still studying how it might lend further support, including possibly through the IMF.

"China is also considering increasing its participation in the solution of the European debt crisis through the channels of the EFSF and ESM," Wen said.

The ESM, a 500-billion-euro ($650 billion) permanent bailout fund that is due to become operational in July, is expected to replace the EFSF, a temporary fund that has been used to bail out Ireland and Portugal and will help in the second Greek package.

China, with its $3.2 trillion worth foreign exchange reserves, is often seen as a potential source for the funds that are needed to bail out some European governments.

China has repeatedly said it supports a stable euro, and according to most estimate, China has about a quarter of its foreign exchange reserves in euro assets.

However, Beijing has consistently been reluctant to make specific promises about any contributions to the rescue funds.   Continued...