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European leaders struggle to end debt crisis

01-12-2012 07:32 BJT

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European leaders are continuing to struggle to solve the debt crisis. Italian Prime Minister Mario Monti has visited Berlin for talks with his German counterpart Angela Merkel to find out a way to get Italy out of its economic woes.

It started two years ago but European leaders are still trying to get a grip on the debt crisis.

German Chancellor Angerla Merkel (R) and Italian Prime Minister Mario Monti arrive to
give a press conference at the Chancellery in Berlin on Jan. 11 after their talks on
the euro crisis.

In 2011, Italy’s economic woes were thrust into the spotlight and it got a new leader.

Now Prime Minister Mario Monti is visiting Berlin for his first talks with Europe’s paymaster.He’s been discussing his austerity measures with German Chancellor Angela Merkel.

Monti said: "This was a very mature attitude by Italians, and it doesn’t merit a reward from Europe, because the measures we adopted were adopted in the interest of the Italian people, but it does merit a recognition by Europe that it doesn’t have to fear any more that Italy is a possible source of contagion for Europe."

Angela Merkel praised Italy’s speed at bringing in its reforms, as Monti aims to make the economy more competitive.

But Rome still faces borrowing costs of around 7 percent - widely seen as unsustainable for an economy saddled with debt of around 120% of GDP.

Italy says it’s committed to EU’s move toward fiscal union - but that’s just one entry on Europe’s to-do list this year.

Angela Merkel said: "The euro zone’s first obligation this year is to resolve a second Greek program and finalize these negotiations with the banks so that we can then concentrate on structural problems in the euro zone."

Meanwhile in France President Nicolas Sarkozy was meeting an old acquaintance - formerly his Finance Minister now Head of the IMF Christine Lagarde.She is holding a series of meetings in Europe on the debt crisis.She didn’t make any comments after the meeting - but last week Lagarde said she thought the euro currency was likely to survive 2012.

But such statements don’t seem to have reassured investors.

A recommendation from ratings agency Fitch that the European Central Bank should increase its purchases of euro zone debt to prevent a "cataclysmic" collapse of the euro - saw investors sell off stocks and head to the safe haven of German government bonds.

And that doesn’t bode well for Italian and Spanish bond auctions later this week.

German Chancellor Angela Merkel and French President Nicolas Sarkozy speak to the
media following talks at the Chancellery on January 9, 2012 in Berlin, Germany.

German Chancellor Angela Merkel and French President Nicolas Sarkozy depart after
speaking to the media following talks at the Chancellery on January 9, 2012 in
Berlin, Germany.

German Chancellor Angela Merkel and French President Nicolas Sarkozy depart after
speaking to the media following talks at the Chancellery on January 9, 2012 in
Berlin, Germany.

Italian Prime Minister Mario Monti speaks to the media after
talks with German Chancellor Angela Merkel at the Chancellery
on January 11, 2011 in Berlin, Germany.


Editor:Zhang Rui |Source: CNTV.CN

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