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Today's Date: 29 July 2010
Last Updated: 29 July 2010 14:31:25 CIT
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More tough love for Greece
Source: Wire Reports
2 March 2010
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ATHENS -The European Union urged Greece to take extra austerity measures within days to tackle a debt crisis that has shaken the euro zone and promised to help Athens overcome the problem.

EU Economic and Monetary Affairs Commissioner Olli Rehn made the call after talks with Greek officials amid growing market expectations of a trade-off between new deficit-cutting steps and practical EU support for Greek borrowing.

"I'm sure that together we shall overcome these formidable economic and fiscal challenges," Rehn said after meeting Finance Minister George Papaconstantinou.

"I want to encourage the Greek authorities to consider and announce additional measures in the coming days to meet this target," he said.

Prime Minister George Papandreou appeared to be preparing the nation for more sacrifices in broadcast remarks to the cabinet dramatizing the crisis and appealing for public support. His labour minister proposed a freeze on pensions this year as one measure to contain spending.

"Today we ask Greek men and women to enlist in our common cause to save our country and the overwhelming majority of our citizens are willing to do it despite the price and despite the burden ... Everybody says yes," Papandreou said.

He has a potentially crucial meeting in Berlin on Friday with Chancellor Angela Merkel of Germany, which is Europe's biggest economy and holds the key to any financial support.

A German government spokeswoman maintained it was up to Greece to pursue budget consolidation to win the confidence of markets and said that Berlin had nothing new to report on the issue of possible steps to support Greek debt.

Greece's borrowing costs tumbled to their lowest level since mid-February on expectations the government will agree soon on new tax rises and spending cuts to plug a budget gap which EU experts say has grown due to a lingering recession.

 
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