Lagarde urges Greek politicians to work together

9th June 2011, Comments 0 comments

French finance minister Christine Lagarde on Thursday urged Greek politicians to follow the lead of Portuguese lawmakers and work together to overcome the country's deepening debt crisis.

"One great strength of Portugal, which I hope Greece will be able to emulate, is (that of) the Portuguese political parties and authorities to join forces and form an alliance," said Lagarde, a top contender to lead the IMF.

"That was critical, critical in building and restoring confidence and it shows in the numbers," Lagarde told a news conference on the final day of her visit to China to drum up support for her International Monetary Fund bid.

Portugal in April became the third country in the eurozone to seek international assistance -- a 78-billion-euro ($114 billion) bailout from the EU and IMF -- to meet its debt payments after Greece and Ireland last year.

All three of Portugal's main political parties -- the centre-right Social Democrats, who won Sunday's general election, the conservative CDS-PP and the Socialists -- signed the bailout deal.

Greece -- which received a 110-billion-euro loan in May 2010 from the IMF, EU and European Central Bank -- has been plagued by political infighting and is likely to need more cash soon despite a titanic adjustment effort.

Greek Prime Minister George Papandreou has failed to win support from political parties for cutbacks, and the IMF envoy to Athens noted this week that the country's recovery programme had "lost momentum".

"If you take Greece, Ireland and Portugal together, they represent six percent of the eurozone GDP," said Lagarde. "Each country is important and matters. They have different categories of problems and issues to address."

Lagarde, a 55-year-old former international lawyer, spent Wednesday meeting senior Chinese officials after a similar visit to India, as she tries to persuade sceptical emerging economies to back her IMF bid.

China, India and other emerging nations have baulked at Europe's traditional lock on the leadership of the Washington-based IMF, calling the arrangement outdated, and so far have been non-committal in public about her bid.

She left Beijing on Thursday and was due in Lisbon on Friday.

© 2011 AFP

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