Euro ministers in new crisis talks

Eurozone finance ministers will hold talks on the debt crisis on Monday to flesh out plans made at a Brussels summit this month to save the European currency. With several members under threat of credit rating downgrades, a key focus of the telephone conference will be boosting International Monetary Fund (IMF) coffers to enable it to come to the aid of floundering economies. A government source told AFP on condition of anonymity that the so-called Eurogroup ministers will from around 1500 GMT "discuss what happens after the European summit of December 8 and 9" on saving the eurozone. European Union members who are not part of the monetary union will also take part. At the recent summit, which saw Britain block plans for EU treaty change to save the currency, member countries announced plans to pump 200 billion euros ($260 billion) into an IMF warchest. Eurozone members were to provide about three quarters, and other EU countries the rest. The aim was to allow the Washington-based institution to come to the aid of eurozone countries in trouble, and the summit gave leaders 10 days to work out the details. Several countries have agreed to the move in principle, without saying how much they would be willing to contribute. Belgium has promised 9.5 billion euros, Denmark 5.4 billion euros and Sweden 11 billion euros. But non-euro country Britain has refused to take part. "We did not agree any increase in bilateral resources last week. We made very clear in that meeting that we were not contributing to that 200 billion euros," a spokesman for Prime Minister David Cameron said Friday. European Central Bank chief Mario Draghi said he was saddened by the spat between Britain and the rest of the EU over London's refusal to join the fiscal package to solve the bloc's debt crisis. "Britain certainly has shown a capacity to undertake a fiscal correction of an extraordinary size," Draghi said in an interview to be published in Monday's Financial Times. "My more general reaction to all this is that it's sad. I think the UK needs Europe and Europe needs the UK." On December 7, ratings agency Standard and Poor's placed major EU economies on watch for downgrades of their AAA credit ratings. Fitch Ratings expressed doubt Friday that an envisaged European budget discipline pact would solve the debt crisis and warned it may soon downgrade six countries, including Spain and Italy. All EU states except Britain agreed last week to draft a strict pact with penalties to ensure they cut budget deficits and reduce their debt, aiming to get it drafted and signed by March. The pact will also be on the agenda Monday, as will Europe's future bailout fund, the European Stability Mechanism (ESM). British Deputy Prime Minister Nick Clegg sought Sunday to draw a line under a row with France that erupted after the Brussels summit when the French central bank governor and senior ministers suggested rating agencies should be mulling a debt downgrade of Britain rather than France. "It's always a bit of a tug of war relationship, but history shows that France and Britain always do best when we pull in the same direction which is exactly what I hope we will do," Clegg told Sky News television. A poll showed that Cameron's Conservative Party had opened up a wider lead on the opposition in the wake of the stormy EU summit. German Chancellor Angela Merkel, however, has not been so lucky -- facing a crisis within her coalition allies over Europe. A junior partner in Merkel's two-year centre-right coalition, the Free Democratic Party, narrowly avoided disaster Friday when a bid by rebels to force it to change its pro-Europe stance failed. Meanwhile, the chairman of one of the eurozone's biggest banks, BNP Paribas, Baudouin Prot, said the euro will come out stronger from the debt crisis but urged governments to act quickly to put their plans into action.