The world’s leading economic powers said they would not allocate more money to fight euro zone debt crisis until the European members increase their own contributions.
According to the statement issued by G20 finance ministers in Mexico City last night, euro zone leaders are required to increase their own rescue fund before any more external resources were allocated via the International Monetary Fund.
Earlier this month, euro zone leaders set up a permanent bailout fund of 500 billion euro, and they plan to further reassess the strength of their support facilities in March. The outcome will provide the basis for ongoing consideration to get access to the IMFÃ¢â‚¬â„¢s additional funding.
A potential decision to increase the euro zone rescue fund is likely to put more pressure on the leading euro zone economies, especially Germany. So far, Germany was not clear regarding whether it was prepared to support such a move.
The euro zone debt crisis resulted in a slowdown of the economic growth in the region’s economies. Europe is a key market for Asia exports, hence as its growth slows down, consumer demand is likely to fall and hurt Asia’s export-dependent industries.The fear is that if the appropriate measures are not taken in time, the euro zone debt crisis may start to hurt global economic growth.
The G20 finance ministers warned that risks to global economic growth continue to remain high.
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