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‘European Stability Mechanism’, sometimes seen in the news, is an:

  1. A.agency created by EU to deal with the impact of millions of refugees arriving from Middle East
  2. B.agency of EU that monitors fiscal discipline of member states
  3. C.bailout fund created by Eurozone countries to deal with sovereign debt crisis
  4. D.agency of EU to coordinate development policies of member states
▶ Answer & Explanation

Correct answer: C. bailout fund created by Eurozone countries to deal with sovereign debt crisis

The European Stability Mechanism (ESM) was established as a permanent crisis resolution mechanism for the eurozone. Its primary role is to safeguard the financial stability of the euro area by providing loans and financial assistance to member states facing severe debt problems or financial distress.

Source: UPSC gs1 2016

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