BRUSSELS (MNI) – Market nervousness is prevailing over facts in the
Eurozone’s sovereign debt crisis, European Commissioner Olli Rehn said
on Tuesday.

Last Sunday, Ireland became the second Eurozone country to accept
external financial support for its debt burden, following Greece which
had accepted a E110 billion deal in May.

But the sovereign debt spreads of many high debt and deficit
Eurozone countries have moved wider this week in the aftermath of the
Irish deal, and the euro has plummeted, as traders speculate that other
Eurozone countries such as Spain and Portugal could also need financial

“Some facts seem to get lost in the prevailing nervousness,” Rehn
told delegates at a conference in Brussels.

“First: No EU sovereign has defaulted on its debt. Instead, the EU
Member States have put up massive resources to back up any member state
facing liquidity problems,” he said. He added that there was “strong
political will” in all countries to put things right.

“I trust that the market forces do appreciate the fact that, while
correcting market failures, we are in parallel addressing the policy
failures of the crisis,” the commissioner said.

“I am confident that by next summer the new system of reinforced
economic governance will be in force, which will include a seriously
more robust Stability and Growth Pact,” he said. This will create a
solid foundation for the euro, he added.

–Brussels: 0032 487 (0) 32 803 665,

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