subject: International Financesource One International (imf Aid For Greece?)... [print this page] Source One International: German and French reticence over the prospect of committing funds to a rescue plan for the beleaguered Greek economy has led to both nations tentatively agreeing to support an IMF role in solving the countrys debt crisis.
Despite Greeces efforts to secure firm financial commitments from the Euro regions two biggest economies, it would appear that the moral hazard the many German and French citizens believe such commitments would represent has forced Chancellor Angela Merkel and French President Nicolas Sarkozy to consider the alternatives available.
Source One International analysts suggest that, if the IMF plan goes ahead, there is a likelihood that the credibility of the EU will be undermined.
Many have called the EU little more than a monetary union and, with little in the way of coordinated efforts between member states during the crisis, Source One International believes that this may well be the case.
Germany is known to have an aversion to the prospect of fiscal union which would mean German taxpayers assuming partial liability for debts across the entire European Union.
Greeces premier, George Papandreou, is known to be disappointed with the wrangling over the issue given the fact that he has implemented severe austerity measures in an effort to demonstrate Greeces understanding of the gravity of the situation.
Source One International is thought to expect the euro to recover as the details of the plan become clearer following a two-day EU summit to be held in Brussels.
by: Phillip Krakowski
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