Greece fo­cus of world econ­omy

Van Rom­puy says vote also cru­cial for eu­ro­zone and whole globe; Rehn sees de­fault if pro­pos­als re­jected

Kathimerini English - - Business -

The com­ing hours in Greece are “cru­cial” to the sta­bil­ity of the world econ­omy, Euro­pean Coun­cil Pres­i­dent Her­man Van Rom­puy said yes­ter­day.

Eu­ro­zone lead­ers and pol­i­cy­mak­ers in Brus­sels have pinned Greece’s emer­gency fund­ing on the ap­proval of an­other aus­ter­ity pack­age by the Greek Par­lia­ment, which votes to­day on the plan.

Van Rom­puy said the vote is cru­cial to the peo­ple of Greece, the eu­ro­zone and the whole world.

Euro­pean Com­mis­sion

Pres­i­dent

Jose Manuel Bar­roso, speak­ing be­side Van Rom­puy in the Euro­pean Par­lia­ment yes­ter­day, said the Greek Par­lia­ment must “re­dou­ble its ef­forts.” “We need struc­tural re­forms for Greece to re­cover growth,” said Bar­roso.

The 2012-15 plan in­tro­duces 28 bil­lion eu­ros of aus­ter­ity mea­sures and an am­bi­tious 50-bil­lion-euro pri­va­ti­za­tion plan over the next five years.

Euro­pean Eco­nomic and Mon­e­tary Af­fairs Com­mis­sioner Olli Rehn said yes­ter­day that Greece will im­me­di­ately de­fault if its Par­lia­ment does not sup­port the gov­ern­ment’s eco­nomic aus­ter­ity pro­pos­als this week.

“The only way to avoid im­me­di­ate de­fault is for Par­lia­ment to en­dorse the re­vised eco­nomic pro­gram... They must be ap­proved if the next tranche of fi­nan­cial as­sis­tance is to be re­leased,” Rehn said in a state­ment.

“To those who spec­u­late about other op­tions, let me say this clearly: There is no Plan B to avoid de­fault,” he said.

Rehn’s words ap­peared to be care­fully cho­sen – he did not specif­i­cally rule out a con­tin­gency plan should Greek par­lia­men­tar­i­ans refuse to come into line, but said there was “no Plan B to avoid de­fault.”

EU lead­ers and other se­nior of­fi­cials have called in re­cent days for eu­ro­zone and broader EU mem­ber states to en­sure their banks are well cap­i­tal­ized and are ready to with­stand any prob­lems, in­clud­ing po­ten­tial con­ta­gion from Greece.

Rehn said Greece faced a crit­i­cal junc­ture this week, with both its fu­ture and that of fi­nan­cial sta­bil­ity in Europe at stake.

“The Euro­pean Union con­tin­ues to be ready to sup­port Greece. But Europe can only help Greece if Greece helps it­self,” he said.

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