Merkel Cool to Calls for Boosting Bailout Fund

Associated Press

Davos, Switzerland — German Chancellor Angela Merkel says Europe lacks the "political structures" to make the euro work properly but expressed determination to defeat the currency's weaknesses.

German Chancellor Angela Merkel
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She said the weaknesses "arose over years — so they can't be overcome at one fell swoop." She added "we are determined to do this."

Merkel did not immediately elaborate on how that would happen.

Many of the 2,600 members of the global elite at Davos say they see increasing evidence that Germany will do as Merkel says, and act to prevent a breakup of the euro.

She expressed determination to defeat the weaknesses of the joint euro currency used by 17 nations. But she batted away appeals from the IMF [International Monetary Fund] and others for a big jump in the size of the fund created to help weaker euro zone nations struggling with too much government debt.

Merkel said Wednesday "we guarantee the euro, but what we don't want is to promise something we can't hold."

She also suggested the European Union and the United States should pursue a free trade deal.

Merkel spoke during her keynote address at the World Economic Forum in Davos.