Eurozone crisis could be over in '1-2 years'

The head of Europe's financial bailout fund, Klaus Regling, said the eurozone crisis could be over in "one or two years" if member states stick to their pledges, in an interview to be published Monday. "If all countries in the currency zone strictly fulfil their budgetary consolidation targets and continue to improve their competitiveness then the crisis can be over in one or two years," he told German news weekly Der Spiegel. Regling, who is German, described his European Financial Stability Facility (EFSF) rescue fund as successful in heading off the worst potential consequences of the crisis, now in its third year. "If it weren't for us, Portugal and Ireland would probably no longer be in the eurozone." The EFSF, which was established with a total lending capacity of 440 billion euros ($554 billion), is due to be replaced by a permanent bailout fund called the European Stability Mechanism, with 500 billion euros of firepower. The ESM was due to come into force on July 1, but it has suffered delays, notably due to legal challenges in Germany, the fund's effective paymaster. Regling has been tapped to lead the ESM when it starts operations. He said that a ruling by Germany's highest court on September 12 on the challenges to the ESM would determine its fate. "Without Germany, the ESM makes no sense."