Eurozone crisis seen as threat to global economy

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Eurozone crisis seen as threat to global economy

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World leaders meeting at a G20 summit in Mexico have called for bold action from Europe to overcome the eurozone crisis.

The single currency bloc is being urged to put its house in order as it’s problems are threatening to derail the global economy.

But an indignant European Commission President Jose Manuel Barroso countered that the challenges were not only European:

“I expect the G20 leaders to support and express their confidence in the steps already taken by Europe and indeed for the steps that we are now ready to take very soon. – But the challenges are not only European, they are global.”

But with the World Bank lowering its forecast for global growth this year to 2.5 per cent, many have expressed alarm at what they see as a lack of progress in dealing with the eurozone turmoil.

Brazil’s Finance Minister Guido Mantega said: “The markets and the corporations have lost confidence in the solutions that are being implemented by the countries in the eurozone. That means the measures being taken are not enough to fix the problems.”

In a show of solidarity the world’s largest emerging-market nations, the so-called BRICS – Brazil, Russia, India and China – are to increase their contributions to the International Monetary Fund’s financial firewall.

But while answering Germany’s call to do more to help Europe, the BRICS want in return faster reform of the IMF meaning a bigger say in how it is run.