German parliament approves expanded eurozone rescue fund

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Germany's lower house of parliament ratified an expansion of the eurozone's bailout fund by an overwhelming majority Thursday, relieving Chancellor Angela Merkel as she avoided the humiliation of relying on the opposition to pass the bill.

Newly-released figures showed that 315 out of 330 coalition lawmakers endorsed the bill, meaning that Merkel has win a so-called "Chancellor's majority" -- at least 311 member from her own camp backs the project in the 620-seat Bundestag, or the lower house of parliament.

For the enlarged version of the eurozone rescue fund, or the European Financial Stability Facility (EFSF), a total of 523 lawmakers gave the green light, with 85 voting against it and 3 abstentions.

The expanded EFSF mechanism, agreed by European leaders at a July summit, has earned more flexibility on operation, including being allowed to buy sovereign bonds of heavily indebted eurozone nations on the secondary market and to loan money to countries facing risks of debt crisis as a precautionary measure.

As Europe's biggest economy, Germany has to increase its guarantees from 123 billion euros (167.3 billion U.S. dollars) to 211 billion under the new legislation, the largest among eurozone states, which shoulders up nearly half of the total fund.

The closely-watched vote in parliament, although the outcome has no suspense, is viewed as "a crucial test" for Merkel by German media, as some lawmakers with Merkel's central-right coalition parties vowed to vote against the bill or abstain.

However, Merkel finally got enough votes within her own camp, avoiding apolitical turmoil if she had to rely on the opposition Social Democrats (SPD) and the Greens to get the bill passed, which would severely damage her authority.

Nevertheless, criticisms to Merkel's leadership is going on. During the parliament debate, SPD party chief Frank-Walter Steinmeier accused Merkel and her coalition of "cheating" German people.

"Anyone who promises today, 'that's it', but it is not the truth," he said. "What comes now is the minimum necessary.. It is the minimum essentials to get back to a minimal degree of stability in the European Monetary Union."

Former finance minister Peer Steinbruck of SPD told lawmakers that Merkel would fail in her strategy of "buying time," as she did not give citizens a clean vision of latest threats and following political decisions on the eurozone rescue plan.

For coalition part, Finance Minister Wolfgang Schaeuble said that the guidelines for the EFSF had not yet concluded negotiations, and all these policies would be up to the debate and approval of the Bundestag, fighting back criticism from the SPD that the government is misleading parliament about the true story of the euro rescue.

Schaeuble stressed the need for expanding the rescue fund. "We are in an exceptionally difficult situation, because the nervousness in financial markets is high and there is a risk that it may have an impact on the real economy," he said.

The minister also denied speculations that Germany would enlarge its contribution to the rescue fund. "The German border is set to guarantee 211 billion euros, and it will not be increased."

Germany is the 11th of the 17 eurozone nations who approved the boosted rescue fund. Finland's parliament endorsed similar bill on Wednesday.

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