Greece must decide whether in or out of euro: Sarkozy

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President Nicolas Sarkozy of France and Chancellor Angela Merkel of Germany warned on Wednesday that Greece must decide if it wants to abide by the terms of a bail-out deal and to stay in the euro.

Sarkozy warned that not a further cent in rescue loans would be transferred until Greeks made a clear response, with Athens set to run out of funds and default in weeks unless it receives eight billion euros.

"We hope to pursue Europe with our Greek friends," Sarkozy told a press conference following crisis talks with Greek Prime Minister George Papandreou, German Chancellor Angela Merkel and EU and IMF officials.

On Monday, Papandreou shocked Europe by saying he would put the terms of a bail-out deal agreed last week with European leaders to a referendum, sending panic through markets which thought the rescue plan a done deal.

"The Greeks have to decide whether to continue the adventure with us or not," he warned. "We hope to continue with the Greeks, but there are rules that have to be respected."

"The Europeans and the IMF can't release the sixth tranche of loans to Greece until Greece endorses the package of October 27," Sarkozy said, calling for the referendum "if one is needed" to be carried out swiftly.

If the provisions of the loan agreements are not respected "neither Europe nor the IMF can release even a further cent."

Papandreou later said that a referendum could be held as early as December 4, and acknowledged that Greece's future in the euro was at stake.

© 2011 AFP

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