The European Union has cobbled a last ditch, $960 billion safety net for financially struggling members, hoping to calm fears that the Greek financial crisis will spread to other countries using the euro currency.
European Union finance ministers worked through the night to come up with a massive financial backstop for other weaker economies in the 16-nation eurozone. They wanted to announce the measure before financial markets opened for business this week.
The package includes about $75 billion of loans available from the European Commission, the EU's executive arm, to troubled countries; almost $570 billion more backing through bilateral loans and $315 billion from the International Monetary Fund. It follows a worldwide stock market plunge late last week on fears that the Greek financial crisis might spread to other shaky EU economies, notably those of Spain and Portugal.
At a press conference early Monday, EU Monetary Affairs Commissioner Olli Rehn recognized the problem posed for the nations sharing the euro currency.
"This has clearly been a systemic challenge for financial stability in the euro area," said Rehn. "It is not an attack on one or another individual member state, it is a threat to financial stability of the euro area and the European Union."
Greece's skyrocketing public deficit and debt has sparked international concern that it may default on its loan payments. Financial ratings agencies have downgraded its ratings, along with those of Portugal and Spain. But other European economies are also sending troubling signals, notably Britain which is projected to have a 12 percent deficit this year.
Critics fault the EU for its slow and divided response in dealing with the Greek crisis, notably from the German government which was reluctant to lend Athens money without it first agreeing to further austerity measures.
Berlin ultimately signed onto a massive rescue package for Athens, cobbled by the EU and the IMF. But the idea of shoring up Greece is deeply unpopular in Germany, and Chancellor Angela Merkel's party lost a regional election on Sunday.