The leaders of the eurozone countries are to meet this evening, at the end of the first day of a European Union summit, to discuss a possible loan offer to Greece.
The meeting was announced by Jean-Claude Juncker, the prime minister of Luxembourg, who chairs monthly meetings of the eurozone’s finance ministers.
José Luis Rodríguez Zapatero, the prime minister of Spain, which holds the rotating presidency of the Council of Ministers, confirmed that the euro and Greece’s public finances would be discussed this evening by the 27 nations of the EU.
As national leaders arrived for their two-day meeting in Brussels, both Zapatero and European Commission President José Manuel Barroso warned that the euro’s stability was at stake.
They sought to increase the pressure on Germany to allow the announcement of possible support for Greece, amid worries that inaction on agreeing to co-ordinated loans might cause a run on the euro, which yesterday fell to a 10-month low against the US dollar.
Barroso said: “The euro and Greece isn’t officially on the agenda but obviously it is unthinkable that we bring together the European leaders today without speaking about this issue and without reaching consensus because it is an urgent problem to which we have to find a solution.”
Zapatero said it was “our job” as EU leaders to find a “European solution to Greece’s problems”.
“It is extremely important for the financial system and for the economy,” said Zapatero. “We need confidence in the single European currency. For a lot of European governments the euro was born on the basis of co-responsibility. That is the foundation of the single currency.”
Zapatero said he and his 26 counterparts were to discuss the issue during their Thursday evening talks.
Greece and the Commission are hoping that the summit will agree to a financial rescue package that would allow the country to refinance its debts at more affordable interest rates.
But Angela Merkel, Germany’s chancellor, has been holding out against the eurozone or the EU making an offer of bilateral aid, which faces strong opposition in Germany.
She told the German federal parliament that her government was prepared to see emergency aid combining help from the International Monetary Fund and joint bilateral aid from the eurozone, but only as a last resort.
But some eurozone governments fear that involving the IMF would harm the eurozone’s credibility.
Zapatero said the EU could offer, if needed, “loans at reasonable rates”.
He added there “was no reason” why the IMF would not be involved either. “But the solution has to start and be fundamentally a European one,” he added.
Problems still to be solved among eurozone countries as part of any aid plan include under what conditions Greece should receive assistance, what each member state is willing to provide, as well as how large a role the IMF could play in an aid plan, a source said.
Greece is hoping any bilateral loans offered by the EU or the IMF would be at a lower interest rate than it currently has to pay to raise capital in the markets.
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