The leaders of the Eurozone countries decided in the early hours of Saturday to activate a support mechanism for Greece, Greek Prime Minister George Papandreou announced at the end of a special summit in Brussels.
A three year joint programme with the International Monetary Fund (IMF) makes available 110 billion euro to help Greece meet its financing needs, with euro area member-states ready to contribute for their part 80 billion euro.
French President Nicolas Sarkozy and German Chancellor Angela Merkel announced early Saturday that the 16 eurozone nations will set up a financial defense plan by the time markets open next week to shield their shared currency against further attack. With Spain and Portugal’s fragile financial systems already pounded by markets in the wake of the Greek debt crisis, Sarkozy and Merkel laid out a plan to defend all euro nations against aggressive market movement.
Addressing reporters, Papandreou said that with the decision the eurozone countries “have shown that they stand with determination by our side,” adding that the disbursement of the lown will begin in the coming days.
These funds, he added, will “help us to implement without everyday’s uncertainty in the international markets, the stabilisation and growth programme for our economy.”
“But the summit has shown something more, that the need to shield the eurozone relates not only to Greece’s problems, but that the issue is a broader one and concerns the eurozone as a whole,” Papandreou also said.
“These decisions show that we are going to work all together not to let international speculation acting without control in the markets, to take Europe out of the crisis and contribute substantially to the world economy’s recovery,” the Greek premier said.
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