Brussels • European Union finance ministers will work to secure Spain's teetering economy in two meetings in Brussels this week, with progress expected on the bailout loan for the country's stricken banks and a relaxation of the government's financial targets.
The 17 countries that use the euro have committed to support a loan for the banks of up to $124 billion, but the precise amount needed may not be known until September, when the results of all the bank inspections are in, Simon O'Connor, an EU spokesman, said Monday.
Monday evening, the so-called eurogroup of finance ministers will attempt to reach an agreement on what conditions will be attached to the bailout loan, which will codified in a "memorandum of understanding" to which Spain must agree. The 17 ministers some of whom will need to get approval of the agreement from their parliaments will probably meet again, later in July, to give final approval to that document.
"I expect that already today we will have strong progress on the Spanish situation," French Foreign Minister Pierre Moscovici said Monday on his way into the meeting.
Irish Foreign Minister Michael Noonan said a draft communique regarding Spain was being circulated.
Then Tuesday, in a choreographed companion maneuver, finance ministers from all 27 European Union countries will consider giving Spain an extra year until 2014 to meet its budget deficit target of 3 percent. The European Commission, the EU's executive arm, has formally endorsed that proposal.
The eurogroup ministers will also meet Greece's new finance minister, Yannis Stournaras, for the first time Monday for preliminary discussions on whether to adjust conditions accompanying the country's bailout.
Officials say no formal decisions are expected from the meeting Monday. But Moscovici said he was optimistic that the EU would emerge from its financial crisis, in light of action taken toward further economic and political integration at a summit meeting of EU leaders last month.
"I remain very confident that ... the European Council for the first time addressed the globality of the solution, including the problems of development, financial stability, the future, integration, solidarity the European Union that we want," Moscovici said.