Spain’s government plans to make its official request for European Union aid for its banking sector on Monday, Finance Minister Luis de Guindos said yesterday, as Spain and its European Union partners continue to discuss ways to inject European aid funds directly into ailing Spanish banks.
Earlier yesterday, de Guindos said that pumping money directly into banks “is definitely a possibility.”
In related news, German Chancellor Angela Merkel resisted pressure yesterday for common euro zone bonds or a more flexible use of Europe’s rescue funds but agreed with leaders of France, Italy and Spain on a $156 billion package to revive growth.
After four-way talks in Rome’s Renaissance Villa Madama, Italian Prime Minister Mario Monti said the European Union should adopt pro-growth measures worth about 1 percent of the region’s gross domestic product at a crucial summit next week.
But the three others made no perceptible progress in pushing Merkel, who leads Europe’s most powerful economy and the main contributor to its rescue funds, towards mutualizing Europe’s debts or using existing bailout resources more flexibly.
The measures, already in the works in Brussels, include increasing the European Investment Bank’s capital, redirecting unspent EU regional aid funds and launching project bonds to co-finance major public investment programs.
The four leaders did agree to move ahead on creating a tax on financial transactions even though not all EU members will be on board. About a dozen EU states support setting up the so-called “Tobin tax,” more than the nine required to go ahead as a group within the EU, a French presidential source said.