Belfast Telegraph

Saturday 27 December 2014

EU leaders await new Greece vote

Greek Prime Minister George Papandreou survived a confidence vote (AP)
Greek Prime Minister George Papandreou survived a confidence vote (AP)

Europe's leaders are due to gather in Brussels with the Greek economic crisis on a knife-edge and nothing - for the moment - that they can do about it.

The long-arranged summit comes just after the Greek Prime Minister George Papandreou survived a confidence vote and just before the Greek parliament votes next week on more austerity measures being demanded by the EU and IMF in return for more bailout money, due to be paid next month.

"It's down to the Greeks now to approve austerity measures and then we can see about further assistance" said one EU official. "In the meantime there can be no developments at this summit, and there will be pressure on leaders to say as little as possible at this delicate time".

Prime Minister David Cameron is joining the summit dinner after a day of talks in Prague with the Czech prime minister and president.

When he gets to Brussels he is expected to repeat his insistence that the UK - which did not contribute to the first Greek 110 billion-euro (£96.5 billion) bailout last year - should not be involved in a second, similar, deal likely to be concluded later this year.

The final summit declaration is likely to be restricted to emphasising that efforts remain on track to stabilise the Greek economy and restore confidence in the embattled euro.

An extra meeting of EU finance ministers has already been scheduled for July 3 to assess the situation after the Greek parliament vote next week, when anything less than approval of more austerity will be seen as a political as well as economic catastrophe for the euro.

One official in Brussels reflected the pessimistic tone in EU capitals, saying: "Many find it hard to think there could be a No vote (in the Greek parliament), because we are so close to the edge of a cliff."

Any such public pronouncement from any EU leader in the next few days will be seen as risking triggering more damaging speculation against the euro, as well as influencing the outcome of the Greek vote.

And any final summit declaration on Greece is likely to be restricted to emphasising that efforts remain on track to stabilise the Greek economy and restore confidence in the embattled euro.

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