News in Brief

Euro zone must fast set up bank fund, says ECB

European Central Bank (ECB) president Mario Draghi said yesterday that the 17-country euro zone must swiftly set up a joint fund to restructure and wind down troubled banks – a necessary step to stabilising the financial system. The fund should be financed by levies on financial institutions to ensure it would not tap taxpayers’ money over the medium term, Draghi said, guaranteeing that “resolution costs were first and foremost borne by the private sector”. “The fund must be able to make timely and impartial decisions on how best to deal with a troubled bank, independently of national considerations.” That would help to break the perverse link between sovereign and banks, Draghi said, referring to the situation where rescuing troubled banks is hurting euro zone nations with already weak public finances. But such a joint fund is met with scepticism in countries like Germany, where politicians fear their countries’ money could be used to bail out banks in other countries. Leaders have called on the European Commission to draft a proposal for such a fund, as many details of its planned implementation remain unclear. – Sapa-AP

Unions ‘the answer for farmworkers’

Recruiting farmworkers to join unions was the only way to advance their interests, the Food and Allied Workers Union (Fawu) said yesterday. Speaking to workers at Ramaphosa village in the Eastern Cape, Fawu general secretary Katishi Masemola said unions were vital. They had become even more necessary since farm owners had threatened to retrench workers, claiming they could not afford the new minimum wage. – Sapa