Luxembourg’s Jean-Claude Juncker said European Union states should meet a Dec. 19 deadline for arranging loans to the International Monetary Fund as part of a crisis-fighting accord, though Germany’s Bundesbank said it sees “no urgent need” to reach a decision.
At a Dec. 9 EU summit, countries were given 10 days to say “what’s happening and we’re collecting this at the moment,” Juncker told reporters in Luxembourg today. Asked if the EU would meet its informal deadline, he said: “I think so.”
An hour later, the Bundesbank said it won’t rush to a decision on the loans, which are to be provided by EU national central banks. “We don’t see an urgent need for a final decision,” a Bundesbank spokesman said by telephone. “We want to evaluate the whole situation.”
EU leaders decided at the summit to channel an additional 200 billion euros ($261 billion) in loans to the IMF to help fight the euro region’s debt crisis. In putting the extra funds on the line, European governments for the first time extracted a contribution from national central banks. Euro-area countries are expected to provide 150 billion euros, while non-euro EU states will chip in around 50 billion euros more.
The euro extended gains after Juncker’s comments, touching an intraday high of $1.3084, before retreating to $1.3072 at 2:55 p.m. in Brussels, up 0.4 percent.
Juncker said he hadn’t spoken with Bundesbank President Jens Weidmann about the loans to the IMF.
The Bundesbank can provide as much as 45 billion euros to the IMF only if nations outside the euro area also contribute, Weidmann said this week.
“The Bundesbank has stated its readiness to provide up to 45 billion euros as long as there is a fair distribution of the burden amongst the IMF members,” Weidmann said. “If these conditions are not fulfilled, then we can’t agree to a loan to the IMF.”
Russia may provide as much as $20 billion of assistance to the euro area through the IMF, Arkady Dvorkovich, chief economic aide to President Dmitry Medvedev, said yesterday. Russia has committed to $10 billion and may consider providing another $10 billion, he said.
The possibility of Russia expanding its aid offer “isn’t pressing yet because no one has even asked for the first ten,” Dvorkovich said. The Russian central bank would lend the additional money to the IMF as European central banks are doing.
Juncker said a draft of the fiscal-compact accord hammered out at the EU summit will be distributed on Dec. 20.
“We’ll get the draft accord on Tuesday,” he said, adding that he will decide today whether to convene a meeting of euro-group finance chiefs later next week to discuss the agreement.