No 'plan B' if Greece fails to repay its debt

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No 'plan B' if Greece fails to repay its debt

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There will be no bail-out for the struggling Greek economy, according to Europe’s finance commissioner, because – it is claimed – there is no risk that Athens will default on its debt.

Euronews business correspondent Constantino de Miguel reports from the World Economic Forum in Davos.

“Some economists have warned that the public debt of states like Greece is a time bomb that could blow the euro apart. But top economic officials from the eurozone and the Organisation for Economic Cooperation and Development insist THAT is not about to happen… unless of course there is a failure to heed the danger signs and prepare for a period of austerity,” he says.

Next week the EC will adopt public recommendations for Greece and other economies like Ireland and Spain at commission level, in order to help them balance the books.

Joaquin Almunia, the European Commissioner for the Economy and Monetary Affairs said: “For quite a while we have heard complaints that the euro was too strong – it was overvalued by the markets, but now people are suddenly starting to say the eurozone will be divided. Well this will not be the case. Rather, the eurozone is allowing all its economies to better address the crisis thanks to more resources and more support. In return, those struggling economies should show more responsibility and should take steps to adjust the imbalances produced by the crisis.”

Ultimately the EU will not allow the Greek economy to fail. There are more funding options available to Athens than there would be if it was not in the eurozone.