KARLSRUHE, Germany (PNN) - September 12, 2012 - The Federal Constitutional Court in Germany gave Chancellor Angela Merkel a significant victory on Wednesday in her bid to master the debt crisis that has buffeted the European continent for years and endangered its common currency, granting approval to one of the main pillars of her strategy.

With the ruling, the 17 European Union countries that use the euro will be able to move ahead with the establishment of the European Stability Mechanism, something like an EU version of the International Monetary Fund. The mechanism will handle bailouts and work in tandem with the European Central Bank to buy the bonds of countries like Italy and Spain that are straining under high interest rates.

The court ruled that Germany could proceed with its contribution to the mechanism, but it set certain conditions, including a requirement for parliamentary approval of any increase in the agreed-upon German contribution of 190 billion euros ($240 billion).

The fund, with $644 billion, is intended to buoy struggling countries and help protect the common currency, an impossible mission without Germany, which has the European Union’s largest economy. Although the ruling is unlikely to still Europe’s economic crisis entirely, a rejection could have unleashed new waves of instability and thrown the fitful march toward European integration into question.

For Merkel, rejection by the court would have been a severe political blow. Her coalition has been weak and fragmented at home. Her leadership in Europe has helped her clamber above the domestic political fray, even if many are leery of Germany’s growing financial commitments.

Some experts saw the ruling as a step toward the common sharing of debt among members of the euro zone - a step that Merkel has firmly rejected but that her critics suspect she now quietly approves.

A temporary bailout fund for fellow euro zone members has already promised much of its available money to Greece, Ireland and Portugal, as well as to the planned recapitalization of Spain’s banking sector. Buying Spanish bonds would quickly exhaust its reserves, let alone trying to help Italy with the cost of financing its enormous debt.

With the court’s support for the permanent bailout fund, Europe is moving beyond its common monetary policy toward encouraging its core group of countries to develop a more unified fiscal policy as well.