IMF loan takes chunk out of Lux coffers

Luxembourg is to lend 2.06 billion euros to the International Monetary Fund (IMF) as part of a series of bilateral loans made from the eurozone totalling 150 billion euros.

Prime Minister Jean-Claude Juncker confirmed that a deal was struck via a telephone conference on December 19 between eurozone members.

Together, chiefs of state from member states agreed to loan a total 150 billion euros to the IMF, to which Luxembourg will contribute a substantial 2.06 billion. The aim of the loans is to strengthen IMF resources.

The information was made public in a response to a Parliamentary question put forward by ADR Deputy Fernand Kartheiser. In Mr Juncker's reply, he explained that the smallprint of the loans had not yet been finalised and will be discussed between member countries and the IMF.

For Luxembourg, the details will be worked out through discussions with the Banque Centrale de Luxembourg and the government.

The total loan for each member state was calculated according to a series of factors, including GDP, openness of the country's economy, economic variations and national reserves. As a result, countries like Germany will contribute as much as 45 billion euros towards the loan.

In response to Mr Kartheiser's question as to how the loan will affect Luxembourg's public debt, Mr Juncker said that it was too early to say.