Greek bailout deal reached at EU summit
A deal has reportedly been reached to help
Greece tackles its debt crisis, after negotiations between
Europe's leaders this morning.
The
European Union's president, Herman Van Rompuy, told reporters in Brussels late this morning that an agreement had been hammered out. The move followed talks involving the German chancellor, Angela Merkel, and French president Nicolas Sarkozy.
Details of the deal were not immediately available. But European commission president, José Manuel Barroso, confirmed that an announcement was imminent. "There is an accord, the presidency will announce it," he said.
Earlier today the prime minister of Greece had appealed for "psychological and political support" as Europe's leaders gathered in Brussels to try to hammer out a bailout for their debt-laden neighbour.
George Papandreou told Le Monde this morning that it was important that the eurozone acted together to address the crisis. Papandreou said he expected fellow European leaders to support his efforts to cut Greece's debt, which is
expected to hit 120% of GDP this year.
Britain, though, has already ruled out contributing to any rescue. The chancellor, Alistair Darling, said there was no plan to use UK taxpayers' money to support Greece.
"The other members of the
euro group want to monitor and manage the situation very carefully, they may have fresh proposals to make," Darling said.
Papandreou told the French newspaper that Europe must say "yes, Greece is credible, we guarantee that their program is realistic".
The ongoing crisis has seen
financial traders take huge bets against the euro, speculating that Greece will fail to solve its financial woes. Papandreou argued that this means it is particularly important the rest of Europe agrees a deal.
"If the speculation continues, it is not the business of Greece but of the eurozone and Europe. It becomes a question of collective will to regulate the speculation," he said.
Papandreou told Le Monde that he did not expect the International Monetary Fund would have to become involved in the rescue. The Austrian chancellor, Werner Faymann, though, predicted this morning that
IMF funds would make up a significant part of any bailout, along with loans from European Union members.
"We don't know yet how it will be organised, but I expect it will be a cooperation between [EU member] countries and the IMF," Faymann told the Austrian radio station ORF.
"We are not talking about a donation or subsidies, we are talking about loans with interest, which we provide to help a country in order to avoid irritations on financial markets and crises nobody can handle anymore," Faymann said.
Today's summit is officially meant to cover medium-term European economic strategy, but has been dominated by the crisis in Greece. It emerged last night that
Germany and France are likely to stand together and pledge to come to Athens's aid by guaranteeing Greek solvency.
The euro rose slightly against the dollar and the pound today, reaching $1.3747 and 88.2p. City experts, though, warn that the crisis will have a critical influence on bond markets as well as currency values.
"The EU will need to show unanimity; any sign of fragmentation will see currency mavericks draw metaphorical blood," warned David Buik of BGC Partners.
"Few would be surprised if the IMF were brought into the equation. There is a real threat of a domino effect and it could implode across the region," Buik warned.
Expectations of a Franco-German initiative hardened last night after a day of frantic discussions in Brussels and across Europe over what to do about Greece and the mixed signals over the timing and substance of the response.
Finance ministers of the eurozone, as well as Jean-Claude Trichet, the European Central Bank president, and Olli Rehn of Finland, the European commissioner for economic and monetary affairs, discussed their options by video conference.
The summit will be steered by Herman Van Rompuy, the new European Council president. Sources close to Van Rompuy have conceded that it had to deliver a strong message to the markets. But his eight-page paper on economic strategy sent out to government leaders for the summit did not include any mention of the crisis.
Извор:
Guardian
