Yesterday, the parliament of Finland (Eduskunta) approved the extension of the European Financial Stability Facility (EFSF). 103 parliamentarians, the whole coalition government ruled by prime minister Jyrki Katainen, have voted for this extension against 66 votes of the “True Finns” and “Center Party”, the biggest parties in the opposition.
Including this voting, the number of countries taking part in the enlargement of the EFSF is 11. This expansion, that could manage 2 billion €, has been approved by Spain, Belgium, France, Greece, Ireland, Italy, Luxembourg, Portugal, Slovenia and Germany.
Its creation is related to the fragile economic situation of Greece. The decision taken the past June 24th was increasing it with 780.000 million € with guarantees. Anyway, if a loan would be necessary, its credit rating is around 440.000 million €.
It means that the contribution of the Nordic country will rise from 7.900 million to 14.000 million €. So, the EFSF is more flexible to face the Greek situation, that is extending day by day.
Behind this decision, we can find a combination of the confidence of financial markets, the wish of reassuring the European stock markets and the attacks against Spanish and Italian risk premium.