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EURO

Sweden may support euro countries in crisis

Swedish Prime Minister Fredrik Reinfeldt announced on Friday that Sweden has not yet ruled out the possibility of supporting a new emergency fund to bail out vulnerable euro countries.

Sweden may support euro countries in crisis
European Council President Herman Van Rompuy & Prime Minister Fredrik Reinfeldt

EU leaders have paved the way for a new emergency fund to bail out vulnerable euro countries through a treaty amendment. According to the draft agreement, the permanent crisis mechanism will be activated according to the draft “if the entirely euro area’s stability is threatened.”

EU countries who continue to use their own currencies, namely Sweden, Denmark, the UK, Poland, Estonia, which joins the eurozone on January 1st, 2011, Latvia, Lithuania, the Czech Republic, Hungary, Bulgaria and Romania, are governed by one particular point in the conclusions.

“The member states that do not have the euro as a currency may, if they wish, participate in this work. They may decide to contribute to activities within the framework for the mechanism on a case by case basis,” the draft states.

A two-sentence amendment to the EU treaty paves the way for the creation of a permanent emergency fund. After just one and a half hours of discussion, European leaders agreed on a treaty amendment, which states that the fund should only be used when no other means exist.

“We are ready to do everything necessary to secure financial stability in the euro area,” EU Commission President Jose Manuel Barroso said when the meeting ended late on Thursday night.

Although the permanent emergency fund was created for the euro zone, Sweden and the other countries outside the eurozone were present when EU finance ministers began discussing details.

Sweden currently supports Iceland, Latvia and Ireland. Reinfeldt has not excluded the possibility of Sweden once again intervening to support crisis-hit countries both in and outside the eurozone.

However, he emphasised that for Swedish support to happen now would involve geographical proximity or financial ties, as well as a clear and reliable restructuring plan and IMF assistance.

“Our starting point is that we make a decision ourselves from case to case. This is about loans and not support – adjusted to conditions on the market,” said Reinfeldt.

“We will look at how the country in question deals with reform so that we feel that we are heading in a direction that will generate growth and improve public finances. A stable euro and a well functioning eurozone is good for Sweden,” he added.

The temporary fund of €440 billion (3.97 trillion kronor, $583.4 billion), which was established in the spring spring and runs until mid-2013 when the permanent fund takes over, has been used to help Ireland.

However, many doubt that there will be enough money to help Portugal, Spain or other strained euro countries that may need support. As such, the current needs require replenishing the fund.

“Very little of the fund’s resources have been used, only 4 percent,” said President of the European Council Herman Van Rompuy.

“The EU and the euro area will be stronger from the crisis,” the European Council wrote in its conclusions from the top-level meeting, according to a draft obtained by news agency TT.

“The growth prospects are strengthening and the fundamentals of the European economy are sound,” EU leaders told the council.

However, according to the conclusions, the crisis “demonstrated that there is no room for complacency.”

In their conclusions, EU leaders gave a nod to Greece and Ireland in recognition of what they described as “impressive progress” in terms of their restructuring programmes and budget decisions. At the same time, they stressed the importance of implementing existing programmes fully.

The EU leaders also agreed to give Montenegro candidate status, the first step towards negotiations on future EU membership.

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FOOTBALL

Sweden sink Russia at women’s Euro

Captain Lotta Schelin and Stina Blackstenius powered Sweden to a 2-0 win over Russia at the women's Euro tournament in Deventer on Friday.

Sweden sink Russia at women's Euro
Sweden's Stina Blackstenius (L) vies with Russia's Elvira Ziyastinova during the UEFA Women's Euro 2017 football match between Sweden and Russia at Stadion De Adelaarshorst in Deventer on Friday. PHOT
Schelin scored Sweden's opening goal on 22 minutes, heading in a superb free-kick taken by Magdalena Ericsson.
 
Blackstenius made it 2-0 in the 51st minute as she picked up a poor goal kick by Russian keeper Tatiana Shcherbak, beat two defenders and fired a shot that Anna Kozhnikova only managed to deflect into the net off the post.
 
“Three points, two goals, that's good,” said Sweden coach Pia Sundhage. “I'm happpy about the result and parts of the performance, especially in the first half.”
 
Russia could have secured a quarter-final berth if they had won, following their surprising 2-1 win over Italy in the Group B opener.
 
But they never got close as Sweden put them under heavy pressure from the start with Kosovare Asllani's long-range shot smacking the crossbar on 10 minutes.
 
It took Russia half an hour to threaten up front, but Elena Danilova missed from long range.
 
At the other end, Schelin shot narrowly wide across goal and Linda Sembrant headed wide from a corner just before half-time.
 
Sweden continued to dominate in the second half but squandered their chances, with Sembrant heading against the post five minutes from the end.
 
“Sweden were very strong when it comes to set pieces, there were a lot of them and this was something that didn't allow us to play well,” said Russian coach Elena Fomina.
 
In the other Group B game, defending champions Germany edged Italy 2-1.