The Straits Times
Published on Sep 02, 2012

Crisis could be over in '1-2 years': EU bailout fund chief


BERLIN (AFP) - The head of Europe's financial bailout fund, Mr Klaus Regling, said the euro zone crisis could be over in "one or two years" if member states stick to their pledges, in an interview to be published on Monday.

"If all countries in the currency zone strictly fulfil their budgetary consolidation targets and continue to improve their competitiveness then the crisis can be over in one or two years," he told German news weekly Der Spiegel.

Mr Regling, who is German, described his European Financial Stability Facility (EFSF) rescue fund as successful in heading off the worst potential consequences of the crisis, now in its third year.

"If it weren't for us, Portugal and Ireland would probably no longer be in the eurozone." The EFSF, which was established with a total lending capacity of 440 billion euros (S$690.5 billion), is due to be replaced by a permanent bailout fund called the European Stability Mechanism, with 500 billion euros of firepower.