China considers contributing to European rescue fund

Germany's Merkel holds talks with China's Hu

BEIJING, Feb 3, 2012 - China is "considering" contributing to European rescue funds, Premier Wen Jiabao has told reporters. But Mr Wen did not make any firm commitment to assist during his news briefing with visiting German Chancellor Angela Merkel.

European leaders view China - with $3.2 trillion (£2tn) in foreign reserves - as a possible source of funds to bail out struggling eurozone economies.

German Chancellor Angela Merkel met China's president on Friday as she seeks to lift Beijing's confidence in Europe where the sovereign debt crisis threatens to tip the region into recession.

Iran and Syria are also expected to be on the agenda during her two-day visit.

China, the world's second-biggest economy, has watched with increasing concern as eurozone economies have deteriorated, and has repeatedly urged European leaders to get a grip on the situation.

Merkel's meeting with President Hu Jintao came a day after talks with Premier Wen Jiabao, who said Beijing was looking at ways it could contribute to Europe's bailout funds and warned of an “urgent” need to solve the debt crisis.

“China is investigating and evaluating ways, through the International Monetary Fund, to be more deeply involved in solving the European debt problem via ESM/EFSF channels,” Wen said at a news conference with Merkel.