I am also convinced that when it comes to resolving future crises in the euro area, the IMF will arguably play a far less prominent role and could, at most, be involved in an advisory capacity. So this increased clout would certainly be helpful. Incidentally, the ESM stands for a substantial form of fiscal solidarity.
ESM chief Klaus Regling has said that an ESM loan costs two-thirds less than an IMF loan because the ESM – unlike the IMF – does not charge a risk mark-up for its loans. In the case of Greece, for instance, the saving comes to 5.6% p.a. of its GDP. This is an major transfer to governments in need of assistance.