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Confusion over conditionality of ESM loans: Think-tank

Friday, June 29, 2012 - 03:54

June 29 - Euro zone leaders have agreed the ESM will be allowed to lend directly to banks. Open Europe's Pieter Cleppe says unclear conditions could open a 'pandora's box'.

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Yours and he just walked through most of the night hit in Brussels a waste result viewers -- in crisis. And ended up agreeing on an agency action to help its Indian Spain that you -- borrowing costs. I'm doing not IP to cat he's had at the Brussels office of iron in your thank you for joining us. Some audio reactions you won't command the summit -- font does it seem that it's leading Spain to go that way. I think they have to a certain extent the main the main decision which has been taken is that. The bailout funds would be involved. To directly funds. It's -- Argentine banks. They seem to be few details of amendment about any conditions that might be attached to future -- from the yes and what do you have any what are the chances that countries are going to try and negotiate. Specific conditions for themselves. Well some news for mussina -- Spain vs. Ardent. For example. I think there's already confusion both exactly this point. Rest miracle -- belong to say that's. There will be a strict conditions. Multi seems to be be denying that so. I'm not sure if they have completely cleared out this point. An intensive that. The future renegotiation. Do you think that certain countries would be looking to see. What conditions are nation's top and then trying to gain the same for themselves. Well Ireland seems to. Things in easing of their deal. Obviously when you've given bail without strings attached to one country that'll open the books on the Iraq. And reopen negotiations over -- place. Did you think this is going to be seeing this amendment -- in many finally begun to give way. And it's a bit that this summit planned macro begun to cave in to demands to other countries. Clubs the this is a short term solution. This is again -- Nick Cannon -- roads just funding to banks would all much strings attached although they claim that it only gonna really do that's. When -- -- supervision. Is gonna set up. But it's a very it's a very credible. And I -- display and you think this is likely to break their dependency between the banks found the sovereigns. Well there's unity behind its. However it's not just dependency -- the problem the -- of the fact that very unhealthy. And sustainable banking system. So so far the post seems to be just bailout the banks and don't even think about -- some banks. Quote the system or shrink the banking system that's copy of the question -- medical house giving him home on that -- this thing. Do you think this summit really has dissolved and the thing I mean is this summit any different had the other nineteen we've seen over the past two years. It's again a very short term perspective that this is the loss to kick the can on the roads. On very short list on a sustainable solution for you resolve its problems. And would it be enough to common back since. Also really very temporary. We see does Spanish interest rates have been dropping this morning. But done they're already up against those so even in this very short -- spends very. Very uncertain how big the effect of these measures will be but I think if they really would do Westinghouse announced. We chased him too dark for funds to banks that took its -- short term relief. Thanks for joining us. I was. I'm John politician as his militants.

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Confusion over conditionality of ESM loans: Think-tank

Friday, June 29, 2012 - 03:54