Greece ‘may still need help’

Britain’s Finance Minister believes Greece will need more help to recover from financial crises.

Monday09, 2011

GREECE may need more help to get through its debt crisis but Britain will argue it should not be part of any further rescue package, Finance Minister George Osborne said yesterday .

Ministers from the eurozone’s biggest economies met on Friday to discuss Greece’s debt situation and Mr Osborne indicated talks were continuing.

He said Greece’s lack of access to international debt markets was problematic but denied the country would necessarily be forced to default. "I certainly don’t think it’s inevitable that Greece is going to default," he told the BBC.

"I think it’s inevitable we are going to look at the Greek package and see what they can do to get through next year but that might involve additional assistance from, for example, the eurozone."

Mr Osborne admitted markets were sceptical about Greece’s ability to refinance maturing debt, something that had been assumed when international lenders first agreed to help Greece last year.

"The market is quite sceptical about that happening and I suspect a lot of my time over the next few weeks is going to be with other European finance ministers talking about how we try to help the Greeks get through this situation."

Mr Osborne said he did not want Britain to be part of any further bail-out of Greece, and was a "reluctant participant" in the European Union-International Monetary Fund bail-out of Portugal.

"I didn’t sign up to that approach. It was something signed up to by my predecessor. We certainly don’t want to be part of any bail-out of Greece, a second bailout of Greece."

The global economic environment remained a tough one, but it would be disastrous for Britain to abandon its deficit-cutting plan, he said. (sourced Reuters)