German lawmakers are expected to approve new powers Thursday for the eurozone bailout fund in a major step toward tackling the bloc's sprawling sovereign debt crisis.

Passage in the lower house looks assured, thanks to support of opposition lawmakers, but the vote has highlighted tensions in Chancellor Angela Merkel's centre-right coalition, which has been strained by members who have balked at the cost of propping up the eurozone's strugglers.

Germany is the biggest economy among the 17-countries that use the euro currency and has to contribute more than others to boosting the firepower of the bailout fund, the so-called European Financial Stability Facility, or EFSF. If passed, Germany will be guaranteeing loans in future to the tune of up to €211 billion, rather than €123 billion so far.

"Today we will make an important contribution to our nation, to Europe and to the stability of the euro," Volker Kauder, the parliamentary leader of Merkel's bloc, said in opening remarks on the debate.

The lawmakers — under close scrutiny from markets — are voting on European leaders' decision in July to increase the effective lending capacity of the fund to C440 billion ($595 billion) and give it new powers, such as buying the bonds of shaky countries or lending money to governments before they get into a full-blown crisis.


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