It has been announced by Downing Street that Britain will not commit more than an additional £10bn to the International Monetary Fund (IMF).
Eurozone hopes for Britain to give at least €30bn in extra resources to the International Monetary Fund (IMF) have been quashed by David Cameron.
It was announced last week that it was expected that the 27 EU members were to contribute an additional €200bn to the IMF in order to help deal with the crisis. It has been announced by Downing Street that Britain will not commit more than an additional £10bn to the IMF.
The €200bn was intended to bolster the markets according to officials in Brussels. Eurozone ministers are said to have pencilled in a British contribution of between €30bn and €50bn, although there has been no official breakdown of how much each country might contribute.
Mr Cameron does not expect to go above the £10bn of “headroom” allowed under a parliamentary vote to increase Britain’s commitments to the IMF, on top of the £29bn that the UK has already committed. Any increase above £10bn would require another Commons vote, which could be problematic given the resistance of opposition parties and many Tory MPs to increasing support to the eurozone before the UK’s financial crisis has been resolved.
The Eurozone statement, which was agreed on Friday in the midst of summit talks on an EU treaty change, was opposed by Mr Cameron, who said Britain would not back the hastily assembled IMF package, especially if it was linked to helping the Eurozone.
On Wednesday business groups voiced their anxieties over Britain’s decision to use its veto at last week’s summit as Mr Clegg held a private meeting with director-generals from leading business groups and industry lobbyists. Those representing financial services said insurers were concerned that Mr Cameron’s isolationist position would make negotiating more difficult ahead of looming regulatory changes.