Oct. 11 - U.S. Treasury Secretary Timothy Geithner says he would back IMF support for Spain ''if the terms make sense''.
The U.S. would support a bailout plan for Spain by the International Monetary Fund (IMF), U.S. Treasury Secretary Timothy Geithner said on Thursday (October 11). There are expectations in financial markets that Madrid will go the way of Greece and have to request a government bailout in the coming weeks or months, despite a euro zone fund of 100 billion euros to recapitalise its banks. On the U.S. economy, Geithner said he was confident Washington could meet its financial challenges. The U.S. economy could be pitched into a new recession because of substantial tax rises and government spending cuts - the so-called "fiscal cliff" - due to hit early next year unless Congress agrees to cancel or delay them. But for his host at this week's summit in the Japanese capital, the Treasury Secretary's message was not so upbeat. The IMF and World Bank annual meetings officially kick off in earnest on Thursday (October 11) and run until Sunday (October 14). (SOUNDBITE) (English) U.S. TREASURY SECRETARY TIMOTHY GEITHNER, SAYING: "The Fund's, you know, been really active, very supportive, with the full support of the United States in this context, doing exceptional things it's never done before. And you know if Europe thinks that's helpful in the future, in that context, and the terms make sense to the fund, we'll be very supportive of that." "If the terms make sense, and they offer the prospect of a better outcome in Europe, then this is completely central and consistent with the IMF's core mission and we should be supportive of it." (SOUNDBITE) (English) U.S. TREASURY SECRETARY TIMOTHY GEITHNER, SAYING: "It's a modest challenge relative to what most countries around the world are facing on the fiscal side. We're in a much better position as a country, you know, a much younger country, our potential growth rates are much stronger than most industrial countries and we have a lot of room to phase in these reforms over a longer period of time." (SOUNDBITE) (English) U.S. TREASURY SECRETARY TIMOTHY GEITHNER, SAYING: "Japan's challenges are very daunting, (a) much, much harder mix of things than we face today (in the U.S.). But you know Japan is a rich country, lots of strengths, very innovative, very high rates of savings. And, you know, like every country what they're wrestling with is to get the political institutions of the country to be able to deliver a more agile response, a better designed set of policies to meet Japan's challenges today. But I mean that's a challenge you'll find familiar in most countries."