Finance Minister Bill English says New Zealand would cope if the International Monetary Fund decided to call on the latest $1.26 billion the Government has offered in the event of a global financial meltdown.
The Government announced on Tuesday it had agreed to lend another $1.26 billion to the IMF, which will call on the money only if the economic crisis in Europe threatens to derail the world economy.
This latest pledge takes New Zealand's total potential lending to the IMF to just over $4 billion, of which about $320 million has already been drawn down.
"We think it will be manageable, and the IMF clearly does because they're taking our commitment seriously," Mr English said.
Mr English says if the IMF does use the loan, it will pay back what it borrows with interest.
He told Morning Report that Europe should use its own resources to solve its problems, but if needed New Zealand would contribute.
"The relatively small costs associated with this, if the IMF needs it, are like an insurance premium that we're paying so that we can keep borrowing every week in these international markets as we will be this week, next week, and the week after, and keep selling our products in these markets every day."
The IMF says it has raised a total of $US456 billion for its crisis fighting fund, with Japan contributing the most, at $US60 billion. China has committed $US43 billion, but nothing has been pledged from the United States.