Leadership

Obama ‘positive’ on curbing speculation - Greek PM

10.03.2010
The Greek Prime Minister George Papandreou has said he received a “positive response” from US President Barack Obama on initiatives to curb market speculation in sovereign debt when he met with him in Washington yesterday.

The Greek PM also said that the issue would be on the agenda of the next G20 meeting.

Papandreou (pictured) is blaming market speculators for exacerbating the debt troubles Greece is currently facing, saying that such speculators are making billions every day by betting on Greece defaulting on its debt.

The European Commission President Jose Manuel Barroso also said yesterday that Brussels is set to closely examine whether or not to ban “purely speculative” credit-default swaps.

He also said the EU would push for international co-ordination on the matter.

“These markets are as mobile as they are opaque. The Commission will raise this question with our international partners, notably at the level of the G20.”

Barroso also acknowledged the role that financial speculation has played in Greece’s debt problems: “If it is true that the current problems in Greece were not caused by speculation on the financial markets, it is also true that this speculation was an aggravating factor.”

Measures to tackle debt crisis
Papandreou, who is on a three-day visit to Washington, also said yesterday that Obama had expressed his support for the austerity measures Greece is pursuing to tackle the country’s debt crisis.

European Commission President Barroso also acknowledged the steps Greece has taken so far to reign in its soaring budget deficit.

Speaking in Strasbourg yesterday, Barroso said that Greece had taken the “necessary measures” to reduce its government deficit this year.

“These measures show the determination of the Greek government to tackle their structural problems,” he said.

Barroso also the Commission has been actively working with Eurozone member states “to design a mechanism which Greece could use in case of need”.

“Such a mechanism would be in conformity with the current Lisbon Treaty, in particular with the no bailout clause. It would include stringent conditionality,” he added.