News / Europe

France, Germany Show Solidarity on Greek Economy

French President Nicolas Sarkozy and German Chancellor Angela Merkel brief the media at a news conference after their meeting at the chancellery in Berlin,  June 17, 2011
French President Nicolas Sarkozy and German Chancellor Angela Merkel brief the media at a news conference after their meeting at the chancellery in Berlin, June 17, 2011

Multimedia

Audio

The leaders of France and Germany signaled Friday they want to find a quick solution to the economic crisis in Greece.  In Greece, the prime minister reshuffled his Cabinet and replaced his finance minister.

Speaking in Berlin, German Chancellor Angela Merkel and French President Nicolas Sarkozy said the stability of Europe's single currency, the euro, is their top priority.

Greece, a nation in the eurozone and part of the single currency, is in major debt.  It needs a multi-billion-dollar loan from its euro neighbors in order to avoid defaulting on that debt.

France and Germany had been at odds over whether private holders of Greek bonds should be involved in a Greek rescue package.

But on Friday, Merkel said the two countries were on the same page.  She said that private investors should participate only on a voluntary basis.  She added that mandatory participation does not have a legal basis.  

Analysts say this is a softening of Germany's position, which they say had been leaning towards forcing losses on private creditors.

President Sarkozy said Friday that France and Germany are committed to defending the euro.  He added that their program has to be put in place quickly.

It is a sign that European countries may be moving closer to a deal to help Greece out of its immediate financial straits.

But Mark Weisbrot, co-director of the U.S.-based research group the Center for Economic and Policy Research, says a bailout in its current form is not going to help Greece in the long run.

"Greece needs to get out from under a big part of that debt, a big part," said Weisbrot.  "Because otherwise, if you have a settlement and there is just a restructuring that allows some payments to be made later and none of the principles to be reduced, for example, then you're just going to end up in the same situation a year or two down the road."

The European Union and the International Monetary Fund (IMF) have made tough austerity measures a condition of any bailout.

Those measures are adding to social unrest in Greece and putting major political pressure on the leading Socialist party.  On Friday, a new finance minister was appointed amid a reshuffle of the Cabinet.

And on Wednesday, tens of thousands of people turned out in the streets to protest against tax hikes and spending cuts.

Weisbrot says austerity is not the key to improving Greece's economic situation, and, in his opinion, Greek citizens are right to battle the policy.

"I think what they're doing right now is important," Weisbrot added.  "They're in the streets and that's where the only pressure is coming from.  And I think they should demand that their government not accept any terms that doesn't get the economy growing immediately."

The IMF said Friday that sovereign debt troubles in Greece and other eurozone countries are putting the global economic recovery at risk.

Speaking in San Paulo, Brazil, the IMF's research director, Olivier Blanchard, said policymakers have to act now to make the financial system more robust.

You May Like

China Investigates Former Powerful Security Chief

Former security chief and member of Politburo Standing Committee, Zhou Yongkang, under investigation for suspected 'serious disciplinary violation' More

India, US Look to Reset Ties During Kerry Visit

This week's talks will be first high level interaction between two countries since Prime Minister Narendra Modi took charge More

Video Young African Leadership Program Renamed to Honor Mandela

YALI program, launched by President Obama in 2010, aims to build skills in business, entrepreneurship, public management and civic leadership More

This forum has been closed.
Comments
     
There are no comments in this forum. Be first and add one

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
Vietnamese Staging Chinese Product Boycott After Oil Rig Spati
X
Reasey Poch
July 28, 2014 7:18 PM
China recently pulled an oil rig from an area of the disputed South China Sea that Vietnam also claims. Despite the action, the incident has had a lingering effect on consumers in Vietnam. VOA's Reasey Poch reports from Hanoi on an effort to boycott Chinese products.
Video

Video Vietnamese Staging Chinese Product Boycott After Oil Rig Spat

China recently pulled an oil rig from an area of the disputed South China Sea that Vietnam also claims. Despite the action, the incident has had a lingering effect on consumers in Vietnam. VOA's Reasey Poch reports from Hanoi on an effort to boycott Chinese products.
Video

Video ESA Spacecraft to Land on a Comet

After a long flight through deep space, a European Space Agency probe is finally approaching its target -- a comet millions of kilometers away from earth. Scientists say the mission may lead to some startling discoveries about the origins of the water on earth. VOA’s George Putic has more.
Video

Video Young Africans Arrive in US for Leadership Program

President Barack Obama's Young African Leadership Initiative has brought hundreds of young Africans to the United States for a six-week program aimed at building their knowledge and skills in fields such as public administration and business. Out of the 50,000 young Africans who applied for the program, just one percent was accepted. VOA's Laurel Bowman caught up with some of those who made the cut and has this report.
Video

Video In Honduras, Amnesty Rumors Fuel US Migration Surges

False rumors in Central America are fueling the current surge of undocumented young people being apprehended at the U.S. border. The inaccurate claims suggest the U.S. will give amnesty to young migrants from the region. As VOA's Brian Padden reports from Honduras, these rumors trace back to President Obama's 2012 executive order to halt deportations for some young undocumented immigrants already living in the United States.
Video

Video Students in Business for Themselves

They're only high school students, but they are making accessories for shoes, fabricating backpacks and doing product photography - all through their own businesses. It's the result of a partnership between a non-profit organization that teaches entrepreneurship and their schools. VOA's Mike O'Sullivan and Deyane Moses met the budding entrepreneurs near Los Angeles.
Video

Video Astronauts Train in Underwater Lab

In the world’s only underwater laboratory, four U.S. astronauts train for a planned visit to an asteroid. The lab - called Aquarius- is located five kilometers off Key Largo, in southern Florida. Living in close quarters and making excursions only into the surrounding ocean, they try to simulate the daily routine of a crew that will someday travel to collect samples of a rock orbiting far away from earth. VOA’s George Putic has more.

AppleAndroid