European finance chiefs have been working hard at the World Economic Forum to reassure business and political leaders that the euro zone is on track to resolve the debt crisis.
They voiced optimism about measures taken so far which have calmed the markets and praised governments for their improved budget discipline.
European Central Bank President Mario Draghi said: “If we go back four years ago, we see basically the beginning of the financial crisis.”
He added: “When we look at the progress that countries have made in the euro area in fiscal retrenchment, and in undertaking structural reforms, it’s amazing.”
Speaking about Greece, German Finance Minister Wolfgang Schaeuble said crafting a new rescue package was not easy because of past slippage in its performance, but it would be done in the coming days: “I don’t expect a default in Greece. I am sure that if everybody is ready to deliver what has been agreed and all the partners of Greece are ready to do it, we will avoid, we can avoid and we will avoid a default of Greece but of course, the private sector has to take its responsibility.”
Ministers praised the ECB’s new round of loans to banks, which its President said had averted a major credit crunch though Draghi conceded credit remains seriously impaired in parts of the euro area.
He also admitted it is not yet clear if that cash is filtering through to companies and consumers in the real economy: “Do we know that actually this money is going to finance the real economy? We don’t have evidence of this yet. We have to wait. There is a lag.”