European Stability Mechanism
a.k.a. ESM
The eurozone's permanent rescue fund, which lends to member countries in financial trouble, with…
In plain English
The eurozone's permanent rescue fund, which lends to member countries in financial trouble, with conditions attached.
The ESM, set up in 2012, replaced the temporary EFSF. It raises money in markets and lends to euro members that lose access to normal borrowing, in exchange for reforms.
Its existence acts as a firewall, reassuring markets that a crisis in one country need not spread to the rest.
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