By Ambrose Evans-Pritchard
Last Updated: 8:16AM GMT 04 Mar 2009
Europe’s financial authorities have revealed the existence of a contingency plan to rescue eurozone states at risk of default, giving the first clear assurance that the EU will mount a defence if monetary union comes under speculative attack. oaquin Almunia, the economics commissioner, said EMU economies in distress can count on EU solidarity if they get into trouble, rather than having to go cap in hand to the International Monetary Fund.
“It is clear that there are serious problems in certain countries. If a crisis emerges in one eurozone country, there is a solution before visiting the IMF. We are equipped intellectually, politically and economically to face this crisis scenario. It’s not clever to tell you in public. But the solution exists,” he said.
Mr Almunia said the probability of a eurozone break-up is “zero”, despite the surge in interest spreads on Greek, Irish, Austrian, and Italian 10-year bonds above German Bunds. “Who is crazy enough to leave the euro area? Nobody. The number of candidates to join is growing,” he said. Link to article
