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European Stability Mechanism

Published on February 8, 2012
Excerpts from the communiqué issued following the Council of Ministers’ meeting

Paris, February 8, 2012

Stability mechanism for member states whose currency is the euro

The Ministre d’Etat, Minister of Foreign and European Affairs presented two bills: one authorizing ratification of the European Council decision amending Article 136 of the Treaty on the Functioning of the European Union with regard to a stability mechanism for member states whose currency is the euro, and the other [authorizing] ratification of the Treaty establishing the European Stability Mechanism.

These two texts are part of the comprehensive strategy set in motion to preserve the financial stability of the Euro Area as a whole. They enable a permanent crisis response mechanism to be established, intended to replace the provisional mechanism of the European Financial Stability Facility, created in June 2010.

The European Stability Mechanism (ESM) will be an international financial organization based in Luxembourg. It will have an initial lending capacity of €500 billion, based on capital of €700 billion (€80 billion of paid-in capital and €620 billion of callable capital). The ESM will be able to use a wide range of tools to contribute, through its interventions, to the financial stability of the Euro Area as a whole./.

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