China to take part in eurozone bailout fund

2011-10-26 17:54:18

China and other emerging powers have agreed to help eurozone countries facing a debt crisis by taking part in a bailout fund, the China Daily said Wednesday, citing a source close to EU decision makers.

The state-owned English language newspaper said leading emerging economies would help to finance the rescue fund through the International Monetary Fund, which would boost their voting rights in the Washington-based lender.

The agreement may be written into the final document at a second emergency summit of European leaders, due to begin later Wednesday, the unidentified source told the newspaper.

Further details on China's investment were not provided.

European leaders have been toying with the idea of asking China, Brazil and other top emerging economies to come to their rescue as they scramble to find ways to boost their defences against the deepening debt crisis.

The eurozone wants to beef up its 440-billion-euro ($610 billion) European Financial Stability Facility to convince markets it has the means to protect highly indebted nations such as Italy.

China has repeatedly pledged support for the euro and eurozone countries -- major buyers of Chinese exports -- as it seeks to shore up the value of its investments and demand for its products.

Chinese foreign minister Yang Jiechi on Tuesday called on the European Union to act to restore market confidence during talks with EU foreign policy chief Catherine Ashton in Beijing.

A meeting between Chinese and European leaders scheduled to take place in China last Tuesday was postponed to make way for the second summit on the eurozone crisis.