Sarkozy, Merkel stand by Greece
European leaders move to kill rumours that Greece is set to leave euro zone
PRESIDENT Sarkozy and German chancellor Angela Merkel have moved to protect the euro and support the banking system with a joint statement that they will stand by Greece and its efforts to clear its debts.
The move, after a three-way telephone call with President Papandreou of Greece, comes after increasing rumours that Greece was set to quit the euro zone.
Papandreou has agreed to increase the country’s efforts to cut its international debts as a condition of getting a second European bail-out of €159 billion to shore up its finances.
A French government statement said that Sarkozy and Merkel were “convinced that the future of Greece is in the euro zone”. They rejected calls for an “orderly insolvency” of Greece.
The move is intended to ease pressure on banks – especially the French banks Crédit Agricole and Société Générale, who would be left dangerously exposed by a financial collapse in Athens.
Already financial ratings agency Moody’s has downrated both banks because of their exposure and it is keeping BNP Paribas, “under surveillance”.
Banque de France governor Christian Noyer said that the downgrade was no cause for alarm.
Photo: Medef
