Ministers delay bail-out decision
Europe's finance ministers prolonged the agony for Greece and the eurozone today by delaying a decision on more bail-out cash for the country.
The move came in the midst of mounting speculation that Greece is heading for bankruptcy, defaulting on its debts and destabilising the single currency economically and politically.
Before flying to the talks in Wroclaw, Poland, Chancellor George Osborne used a speech in Manchester to warn that the EU was running out of time to demonstrate determination and control which would steady jittery financial markets.
He called for a "much better international response" in the wake of months of in-fighting over how far to go to bail-out struggling eurozone economies, and how quickly.
"I will be looking for my European colleagues to send a clear signal that they truly recognise the gravity of the situation and that they are dealing with it" Mr Osborne said.
Today's meeting, which put off a decision on the next step for Greece until October, was the latest effort to manage the situation by calming markets and keeping a programme of Greece rescue cash on course.
But postponing paying out the latest tranche of agreed money reinforced fears that no-one believes Greece is doing enough to implement promised economic austerity measures at home in return for massive loans from the rest of Europe.
Mr Osborne warned: "Time is short and the eurozone must now implement as quickly as possible their July 21 agreement (to increase the size of a bail-out reserve fund), resolve the uncertainty with respect to Greece, specify how they intend to fulfil the commitment made at last week's G7 meeting to take all necessary actions to ensure the resilience of banking systems and financial markets" the Chancellor told the Daily Telegraph Festival of Business in Manchester.
He added: "Crucially, my European colleagues need to accept the remorseless logic of monetary union that leads from a single currency to greater fiscal integration".
He then flew to Poland to join his colleagues as well as US Treasury Secretary Timothy Geithner, who joined the talks in a clear sign of growing American concern over the handling of the crisis.
The outcome hardly answered Mr Osborne's concern about "a lack of belief in the ability of political systems in the eurozone and in North America to respond".
Nor did it reassure Washington, following Mr Geithner's request to the EU to end damaging "loose talk" about differences within European governments over what to do next.
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