Prime Minister George Papandreou warned Friday of a new round of market turmoil if European leaders fail to reach a satisfactory solution to the continent΄s debt crisis at this month΄s summit meeting.
"If our decisions in the European Union are not brave and effective, this will appear very quickly in the markets and we will find ourselves back at the bargaining table," Papandreou said in a speech to fellow members of Greece΄s Socialist Party.
His remarks come a week before a special summit of the 17 countries that use the euro to discuss details of a future permanent bailout mechanism for euro-zone countries facing financial difficulties. That meeting will be followed two weeks later by a summit meeting of all 27 EU leaders that is expected to put the final touches on an emergency bailout fund.
Last May, Greece received an EUR110 billion bailout from the EU and International Monetary Fund after being effectively shut out from international capital markets as investors shunned Greek government bonds.
Similarly, in November, Ireland also sought a EUR85 billion bailout and many analysts expect that euro-zone members Portugal and possibly Spain may also face growing difficulties borrowing from markets.
The fund being discussed by EU leaders is meant to assuage those fears and stem Europe΄s debt crisis from spreading further.
However, European financial markets have recently come under renewed pressure amid growing expectations that EU leaders won΄t be able to reach a satisfactory deal by the end of the month.
By Alkman Granitsas
source: Dow Jones Newswires
