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Friday, July 6, 2012

Finland refuses to pay for other countries' debt: minister

HELSINKI: Finland has no intention of footing the bill to cover the debt of other countries in the eurozone, Finnish Finance Minister Jutta Urpilainen said in a newspaper interview on Friday. 

"Collective responsibility for other countries' debt, economics and risks; this is not what we should be prepared for," Urpilainen told financial daily Kauppalehti. 

The newspaper interpreted her comments as an indication that Finland would consider leaving the eurozone instead of agreeing to pay down the debt of other countries in the currency bloc. "Finland will not hang itself to the euro at any cost and (is) prepared for all scenarios," Kauppalehti wrote. 

Urpilainen's spokesman Matti Hirvola rejected that interpretation, insisting to AFP that "all claims that Finland would leave the euro are simply false." 

Urpilainen herself stressed in Friday's interview that "Finland is committed to being a member of the eurozone, and we think that the euro is useful for Finland." 

However, amid the deepening debt crisis in the bloc, she told Kauppalehti that Finland, one of only a few EU countries to still enjoy a triple-A credit rating, would not agree to an integration model in which countries are collectively responsible for member states' debts and risks. 

She also insisted that a proposed banking union would not work if it was based on joint liability. Urpilainen acknowledged in an interview with the Helsingin Sanomat daily Thursday that Finland "represents a tough line" when it comes to the eurozone bailouts. We are constructive and want to solve the crisis, but not on any terms," she said. 

As part of its tough stance, Finland has said it will begin negotiations with Spain next week in order to obtain collateral in exchange for taking part in a bailout for ailing Spanish banks. 

And last year, Finland created a significant stumbling block for the eurozone's second rescue package for Greece, only agreeing to take part after striking a collateral deal with Athens in October 2011.

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