With an eye to calming the turmoil on the markets, Eurozone finance ministers meeting in Brussels have pledged more flexibility for rescue funds and cheaper loans to help Greece and other EU debtors.
But critics are asking if, with the threat of contagion ready to engulf other Eurozone members such as Italy and Spain, the finance ministers are losing control of the debt crisis.
Olli Rehn, EU Commissioner for Economic and Monetary Affairs was adamant they were not. “No, we are now indeed reinforcing our collective crisis response with these measures we have put forward, including the forthcoming decision on the enhancement of the flexibility and scope on the European Finance Stability Facility,” he said.
Despite Italy having the second biggest per capita debt after Greece it also has a low budget deficit but still it’s becoming increasingly vulnerable to market attacks.
Elena Salgado, Spanish Finance Minister said “I think today we are sending a good signal in all the aspects, mainly regarding the flexibility of Europe’s stability mechanism and in recognising all that Greece has already accomplished.”
Euronews’ reporter Paul Hackett reports “Despite the latest market jitters over Italy, ministers here remain determined to quell speculation that the Eurozone’s third largest economy is under threat. What will be of concern is the increasingly unpredictable nature of this debt crisis and when and where it will end.”