Race against clock for EU-IMF-bailout deadline

European finance ministers are racing against the clock to meet a midnight deadline Monday to raise 200 billion euros for new eurozone bailout funding and deliver the cash pledges to the International Monetary Fund.

Reuters/Yves Herman

The money will be raised in the form of individual loans from eurozone and wider EU central banks.

The move was agreed between EU leaders at a 9 December summit following months of struggling to increase the lending capacity of the stretched eurozone bailout fund, the 440-billion-euro European Financial Stability Facility, EFSF.

French budget minister Valerie Pecresse said on Monday that only the IMF had the competence to put public finances back on solid footing.

But problems are already mounting over the fund raising effort.

On Friday, a spokesman for British Prime Minister David Cameron underlined that he had made very clear the country would not contribute.

Hungary is also demanding an exemption.

Only Russia has tentatively suggested it could contribute up to 20 billion euros in loans and investments.

Meanwhile, IMF chief Christine Lagarde speaking in Nigeria on Monday said the European debt crisis posed a risk for “all economies of the world.”

Her comments came as Spanish Prime Minister Mariano Rajoy admitted the country may miss its deficit target of six per cent of GDP while announcing 16.5 billion euros of cuts.