BRDO PRI KRANJU, Slovenia, Feb 2 (Reuters) – The euro zones bailout fund could in the future be at the centre of any restructuring of sovereign debt in the single currency area as part of reforms of the way the zone functions, the head of the fund said on Friday.
The main task of the European Stability Mechanism (ESM) now is to lend cash to governments that have been cut off from markets in exchange for reforms that put their economies back on track. It has helped Greece, Ireland, Portugal, Spain and Cyprus over the past few years.
The euro zone currently does not have any pre-defined debt restructuring rules to deal with a situation in which a government loses market access and has had to improvise on a case-by-case basis to crises.
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