Eurozone bailout fund clears another key German hurdle

BERLIN – (VNS) German President Joachim Gauck on Thursday signed the 500-billion-euro (US$646-billion) eurozone bailout fund, paving the way for the ratification of a key weapon against the eurozone crisis.

Gauck's spokeswoman said he had signed the necessary documents for the European Stability Mechanism (ESM) and fiscal pact for greater budgetary discipline, but that a further step was needed for ratification.

"The federal president needs to ratify the ESM treaty before it can legally come into force," the spokeswoman said.

For this to happen, the German government must integrate the conditions set out on Wednesday by the Constitutional Court regarding the ESM, she added.

In a landmark ruling watched around the world, the court Wednesday cleared Germany's participation in the ESM but capped its share of the pot at 190 billion euros and said any increase would have to be approved by parliament.

The government would "first read the judgement very carefully" and then "promptly decide" how to incorporate the court's decision into law, Chancellor Angela Merkel's spokesman, Steffen Seibert, told AFP.AFP