By Peter Koh

CANNES (MNI) – The European Union wants Greece to remain in the
Eurozone and is prepared to continue its support for the debt-burdened
country but Greece must honour its commitments, EU Commission President
Jose Manuel Barroso said Thursday.

“The euro area stands ready to continue to support Greece, but
Greece needs to stick to the agreed package of 26-27 October and in
particular to continue with the implementation of the EU/IMF programme.
This needs to be crystal clear,” Barroso said in a joint statement with
Herman Van Rompuy, who chairs the meetings of EU leaders.

“We want Greece to remain in the euro,” the two leaders stressed.

Barroso and Van Rompuy stopped short of criticizing a possible
referendum in Greece, saying only that ” national and political unity in
Greece is essential” and that they trusted the Greek people’s “sense of
responsibility.”

An announcement earlier this week by Greece’s prime minister that
he intended to call a referendum on vital reforms and later, on the
country’s continued use of the common currency, angered Germany’s
Chancellor Angela Merkel and French President Nicolas Sarkozy —
who threatened to withhold EU financial aid until Greek authorities
proved their commitment to the terms of a revised bailout deal agreed
last week.

The plans for a referendum, which may now be withdrawn, also led to
public speculation by the leaders of the Eurozone’s two biggest
economies that Greece could be ejected from the EU’s flagship monetary
union.

EU and Eurozone leaders agreed a revised aid package for Greece
with the International Monetary Fund and financial institutions last
week that will halve the country’s public debt burden by 2020.

They also pledged to recapitalize Europe’s banks, leverage the
European Financial Stability Facility bailout fund, and to pursue
fiscal, structural and economic governance reforms.

Barroso and Van Rompuy pledged to implement all aspects of the deal
“very rapidly.”

“The full implementation of the 26-27 October package and the
support of the G20 will enable us to overcome the current turmoil,” they
said.

Brussels bureau: +32495228374; pkoh@marketnews.com

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