Greek stalemate ‘needs resolution’

Published: Friday 13th February 2015 by The News Editor

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The stalemate between Athens and the eurozone over Greece’s debts needs to be resolved to prevent damage to the British economy, David Cameron has said.

The Prime Minister, who held his first meeting with his new Greek counterpart Alexis Tsipras, warned the longer the stand-off continued the worse it would be for the continent.

The UK has called for both sides in the dispute to act responsibly in an effort to avoid another economic crisis in Europe, with Chancellor George Osborne warning of an increasing risk Greece could be forced out of the single currency zone unless the situation was resolved.

Mr Cameron acknowledged that Britain’s economy could be harmed by protracted uncertainty over whether Greece will default on its debts or even abandon the euro.

Speaking in Brussels where he was attending a one-day European Council summit, the Prime Minister said: “The British economy is growing and succeeding, but we are affected by the situation on the European continent and the longer this stand-off goes on the worse potentially that could be for Britain.

“That only underlines the importance of sticking to our long-term economic plan.”

Mr Osborne told Sky News: ” I think the risks of Greek exit have risen in the last few weeks and that’s not good for the UK, it’s not good for financial stability in Europe.”

He added: “We want this stand-off resolved. I think there is a danger of accidents, missteps, people saying the wrong thing, getting themselves boxed into positions in the eurozone, that could lead to the accidental exit of Greece from the euro.”

In the meeting with Mr Cameron, the Greek Prime Minister highlighted the democratic mandate he had won from the people of his country for his anti-austerity stance.

British officials made clear that Mr Cameron expected both Greece and the eurozone nations – of which Germany is the most influential – to “act responsibly” and work on a solution.

“I think there is a solution that can be found but it is for the eurozone and the Greeks to do that and we want them to get on with it,” one said.

Asked if the Prime Minister was frustrated by the failure of talks so far between Greece and the other single currency nations, a source said: “The longer this drags on, the greater the risks both to the eurozone and to the UK economy.

“Stalemate is not getting us anywhere. It’s not getting you growth in Greece and it’s not strengthening the eurozone, so one way or another they need to come together to find a common solution and act responsibly to work out how they are going to tackle this issue.”

The source said Mr Tsipras and Mr Cameron “talked a bit about the politics in Greece, Tsipras talked about the pledges he has been elected on and wanting to fulfil and respect that democratic mandate that he has got”.

Welcoming Mr Tsipras to his first European Council meeting, Mr Cameron warned him the summits “can go on all night and in to the next day”.

Mr Tsipras, the leader of the radical Syriza party, has made refusing to wear a tie a key part of his image and once again went open-necked for the high-level meeting.

The Greeks will hold technical talks with representatives from the “Troika” behind the bailout – the European Commission, European Central Bank, International Monetary Fund – in an attempt to find common ground ahead of a further meeting of finance ministers on Monday.

London Mayor Boris Johnson said he expected a deal would be struck to “shell out” to keep Greece in the eurozone.

On a visit to the United States he told Bloomberg TV that the eurozone could “unravel” if Greece left, because with currency unions “when one goes, they all tumble out”.

“Everybody in power in Europe basically reckons there’s nothing for it; they’ve got to try and keep this thing together. So I think they’ll try and do a deal with Tsipras,” he said.

“I think they’ll shell out – I can’t tell you exactly how it will be done, but I think that if I were sitting in Athens’ place, I think I would feel my negotiating position was pretty strong.”

Published: Friday 13th February 2015 by The News Editor

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