Euro zone's Dijsselbloem wants bailout fund turned into a European IMF


BERLIN (Reuters) - The European Stability Mechanism (ESM) -- the euro zone's bailout fund -- should ultimately be turned into a European version of the International Monetary Fund, the head of euro zone finance ministers said on Monday in a German newspaper.

"I think it would make a lot of sense for the euro zone bailout fund ESM to be developed into a European IMF in the medium to long term," Jeroen Dijsselbloem told the Frankfurter Allgemeine Zeitung (FAZ).

He said that would also mean that Greece's current "troika" of lenders - the European Commission, European Central Bank and the IMF - would need to be broken up in the longer term.

"The ECB feels increasingly uncomfortable in its troika role, and rightly so I think," Dijsselbloem said, adding that the European Commission had other "important tasks" that it should concentrate on.

He said the ESM should "build up the technical expertise that only the IMF has at the moment".

German Finance Minister Wolfgang Schaeuble has also proposed turning the ESM into a European monetary fund to improve the management of crises in Europe.

"With the approval of an ESM programme, the participation of creditors in the restructuring of debt could in future be anchored in accordance with clear and predictable principles," Schaeuble wrote in an opinion piece for the FAZ.

A transparent and predictable mechanism for restructuring public debt would help strengthen market discipline, reinforcing the "no bailout" principle in the EU treaty, Schaeuble said.

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