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Greek PM: Not leaving the euro zone

Greek PM: Not leaving the euro zone

Greek Prime Minister George Papandreou said Thursday that his country's financial woes are being used as a "weak link" to target the wider euro zone.
Greece's ballooning budget deficit and public debt _ combined with past suspect accounting practices _ have alarmed international markets and the European Union, which urged coherent and speedy corrective action.
The country's economic problems have weakened the standing of the euro, which fell half a percent lower to $1.3953 to six-month lows, while forcing Greece to borrow at a high premium.
"This is an attack on the euro zone by certain other interests, political or financial, and often countries are being used as the weak link, if you like, of the euro zone," he said at the World Economic Forum in Davos, without elaborating.
"We are being targeted, particularly with an ulterior motive or agenda, and of course there is speculation in the world markets."
Papandreou reiterated earlier vows that Greece will not be forced out of the euro and will not default on its debts. He cited Monday's sale of (EURO)8 billion worth of government bonds, its first issue of the year that was heavily oversubscribed, calling it a "vote of confidence."
The interest rate Greece had to pay was an expensive 6.2 percent, more than 3 percent above the benchmark yield for German government bonds of the same maturity. That highlights the increased hardships debt-ridden Greece faces in meeting its high borrowing requirements.
But that was overshadowed by speculation that Greece had sought out China to buy Greek bonds, something he said never happened.
"We had no such contacts and we denied this ... and the Chinese government denied it," he said. The speculation "was considered a vote of no confidence to the Greek economy which changed the spreads immediately."
As a result, he said the rumors caused markets more worry and concern about the country's financial health.
Papandreou said the deficit, however, was Greece's own doing.
"We Greeks are responsible for putting our house in order," he said.


Updated : 2021-02-27 07:54 GMT+08:00