Cameron lectures Greece, Clegg lectures Germany

By
Unrest has been heightened in Greece as austerity measures hit.
Unrest has been heightened in Greece as austerity measures hit.

The British government has tried to bring the two sides of the eurozone debate together with separate messages to the Greek and German people on the back of a G8 meeting in the US.

David Cameron used a Nato summit in Chicago to brand next month's Greek elections "a decision point" for whether the country wanted to stay in the eurozone.

Meanwhile, Nick Clegg was urging German voters to see things from the rest-of-Europe's perspective in an interview for Der Spiegel.

"Whilst I have a huge amount of sympathy with German taxpayers, it is not sustainable to believe that the eurozone can thrive through fiscal discipline alone," Mr Clegg said.


"It also has at some level to include an ability to either share debt or to deal with shocks in one part of the system or the other through fiscal transfers."

He added: "This cannot carry on, because the combination of economic insecurity and political paralysis is the ideal recipe for an increase in extremism and xenophobia."

Mr Cameron took a tougher line with Greece, which recently saw far-left party Syriza do extremely well in elections. With the parties unable to form a coalition, voters must return to the polls on June 17th, when the far-left are expected to do even better than last time.

If a governing bloc emerges which wants to renegotiate the bail out plans, analysts expect the country to slip out the eurozone. Mr Cameron clearly believes the Greek public should consider the vote a referendum on eurozone membership.

"We are coming to a decision point where Greece is going to vote," he said.

"It has to be absolutely clear there is a choice: they can vote to stay in the eurozone and meet their commitments, or they can vote to give up on their commitments and effectively give up on the eurozone.

"The choice Greece faces is maintaining its commitments and maintaining its place in the eurozone or deciding that's not the path it wants to take," he added.

"What is required is decisiveness, strong actions by government – whether action to deal with deficits, to deal with the banks, to calm markets.

"The eurozone has to put in place the most robust contingency plans for both eventualities because the world is suffering from continued uncertainty in the eurozone. So this is a decision point."

There were also warnings for Greece from across the British political spectrum.

"But if they get a lot of cranky extremists elected, they will default on their debt and everybody says they will leave the euro," justice secretary and Europhile Ken Clarke said.

"For the Greeks, that will be disastrous. They will encounter real poverty."

Shadow chancellor Ed Balls told Sky: "If Greece does try to leave the eurozone in a disorderly way it would cause huge damage to the world economy, to the British economy, and to the eurozone economy, as the eurozone has not sorted out how to stop this crisis spreading to Spain and Italy."

Later this week there will be an EU meeting in which European leaders are likely to start planning how an orderly Greek default might he handled.
 

Comments

Load in comments