'European Stability Mechanism', sometimes seen in the news, is an
A
agency created by EU to deal with the impact of millions of refugees arriving from Middle East
B
agency of EU that provides financial assistance to eurozone countries
Correct Answer
C
agency of EU to deal with all the bilateral and multilateral agreements on trade
D
agency of EU to deal with the conflicts arising among the member countries
Explanation
The European Stability Mechanism (ESM) is a permanent intergovernmental organization established in 2012 to provide emergency financial assistance and "bailouts" to eurozone member states experiencing or threatened by severe financing problems. While the refugee crisis was a prominent news topic in 2016, making option (a) a tempting distractor, the ESM's mandate is strictly limited to maintaining financial stability through loans and debt restructuring rather than humanitarian issues. This question tests the core concept of international financial institutions and the Eurozone’s institutional framework for managing sovereign debt crises.
International OrganizationsEuropean Union InstitutionsEuropean Stability MechanismESMEuropean UnionEurozonefinancial assistance