3 Min Read
* Fekter says euro FinMins to discuss EFSF's effectiveness
* Opposes Greek debt haircut
* Austrian Chancellor: Greece must meet conditions to get funds (Combines stories, adds quotes)
VIENNA, Sept 27 (Reuters) - Euro zone finance ministers will discuss on Monday whether the beefed-up EFSF fund to bail out struggling member states has the firepower it needs, Austrian Finance Minister Maria Fekter said.
"We decided already in spring that the EFSF has to be able to act more flexibly. We are giving it this flexibility now," she said on Tuesday, noting the fund has gathered experience on how to use taxpayer money and find ways to refinance itself on the markets.
"We will probably discuss intensively this coming Monday (in Luxembourg) if what is already on the table suffices or if it needs to be complemented," she told reporters when asked about prospects to add leverage to the bailout fund.
Euro zone leaders agreed on July 21 to give the 440 billion euro ($592.7 billion) European Financial Stability Facility (EFSF) more powers. The deal requires parliamentary approval in the 17 member countries.
Approval from Vienna seems assured. An Austrian committee earlier gave the green light for a full parliamentary vote on Friday on expanding the EFSF.
European shares rallied for a second day on Tuesday and safe-haven Bunds fell on reports that policymakers were preparing more decisive action to tackle the bloc's sovereign debt crisis by leveraging the fund.
Fekter said the idea of making the EFSF more effective had been a topic for months and experts had worked over the summer on technical conditions for allowing this.
"Now the media are focusing on this but the decision is not new to me," she said.
Fekter, a hardliner when it comes to fiscal discipline, said she opposed reducing the value of Greece's sovereign debt, a day after she described this move as "the very last option".
"I am against cutting the debt because that would immediately do harm to Austrian taxpayers and not bring a smidgeon more growth to Greece," she said, adding the way forward was to buy the Greeks more time to introduce reforms.
"I don't buy the idea of removing the pressure because then the reforms would be not carried through consistently."
Fekter also took pains to rule out a collapse of the euro zone.
Austrian Chancellor Werner Faymann said he believed Greece would take the steps needed to get bailout aid and that there was no danger Greece would get kicked out of the euro zone.
$1 = 0.742 Euros Reporting by Michael Shields and Angelika Gruber; Editing by John Stonestreet