Greece calls for new taxes to help debt-hit EU nations

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Greek Prime Minister George Papandreou called Monday for new taxes on carbon dioxide emissions and on financial transactions to help stabilise shaky European Union economies.

Papandreou said he "discussed the proposal of the new stability mechanism for the EU," during talks with French President Nicolas Sarkozy in Paris.

"We need economic governance which also promotes not only stability but growth ... We need a mechanism which can be funded through different forms and different ways," he told reporters.

"My proposal is that taxes such as a financial tax or carbon dioxide taxes could be important revenues and resources for funding such a mechanism.

"And of course we believe that this mechanism will further create stability for Europe."

Following Greece's near financial collapse earlier this year, EU leaders in October said it was necessary to create a permanent emergency fund for debt-hit eurozone nations, with the aim of reassuring financial markets.

A three-year fund was set up earlier this year after Greece had to be bailed out to the tune of 110-billion-euros (150-billion-dollars) to prevent it defaulting in May.

© 2010 AFP

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