Conflicting EU and IMF Press Briefings

Futurus

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A TALE OF TWO PRESS BRIEFINGS

A] From the Council of the European Union, Economic & Financial Affairs, Press Release of 9/10 May:

‘In addition, euro area Member states stand ready to complement such reserves through a Special Purpose Vehicle that is guaranteed on a pro-rata basis by participating Member states in a co-ordinated manner and that will expire after three years, respecting their national constitutional requirements, up to a volume of E440 billion. The IMF will participate in financing arrangements and is expected to provide at least half as much as the EU contribution through its usual facilities in line with the recent programmes.’

B] Press Briefing by IMF First Deputy Managing Director, John Lipsky, 10/5/10 at the IMF, Washington:

QUESTION

‘But it doesn’t mean that you are setting aside 250 billion euros in case the Europeans would come to you?’

MR. LIPSKY

‘No.’

QUESTION

‘Can I just ask you, who came up with the 250? Was it the European [inaudible] or was it the IMF?’

MR. LIPSKY

‘Well, remember, we’ve never said 250, per se, like that. Right? This is …’

MR. LIPSKY (later)

‘We haven’t made any blanket commitment to provide X. It was simply – again – this is rather – I’m not trying to say it’s wrong. It’s a hypothetical or theoretical number that would say, if the mechanism was fully utilized and we can … and that we apportion funds or provide support in a proportion that we described, that it would imply a total. But this is not a matter of … we pledged x.’

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Bottom Line. There is no IMF pledge of any amount (but, of course, it may come up with some financing as laid out by Mr. Lipsky).

Anthony Scholefield

13 May 2010

[Anthony Scholefield is the Director of Futurus, a think tank specializing in EU and immigration matters and is also a member of the Global Vision Academic Council. His latest booklet, published by the Social Affairs Unit in 2008, is 'Warning: Immigration Can Seriously Damage Your Wealth'.]