August 5th, 2011
03:54 PM GMT
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Olli Rehn, European Commissioner for economic and monetary affairs, Friday said financial markets had not reacted as expected to measures taken by Europe’s leaders to stem the eurozone's economic crisis.

He said the tensions were not justified by economic and budgetary fundamentals of the bloc. Further, the political will to defend the euro should not be underestimated. Euro leaders, he said, had proven they could take decisions and respond to an evolving situation.

Highlights from his speech follow:

On the 21 July agreement by European leaders, in which Greece got improved financing conditions and the Europe’s bail-out funds were given more flexibility to alleviate market pressures, Rehn said:

“We are doing what is necessary to implement the agreement fully and as rapidly as possible. Of course it would have been fantastic if the agreement had been fully operational as of 22nd of July but this was of course impossible. The very technical details of the agreement must be fleshed out and then accepted and ratified in each member state.”

The process was a “necessary and legitimate price to pay for living in democracies,” he said, with experts from his department, euro member states, the European Central Bank and the EFSF – Europe’s bail-out mechanism — “working night and day to put flesh on the bones of the 21st July agreement.”

Rehn said the process should take weeks, rather than months, and “in order to end uncertainly the processes should be finalized by early September.”

Rehn said the technical and political processes were mutually dependent. “There are different procedures for ratification across Europe and we expect all member states to do what is expected of them to meet that timeline and implement the decisions that they have themselves taken.”

On Greece, the first eurozone country to take a bail-out from the IMF and one which has been at the epicenter of the crisis, Rehn said:

“Heightened concerns around Greece are in our view not warranted. Investors seem unconvinced that Greek public debt will be put on sustainable track. I say that this is not the right conclusion.

"[The] 21 July agreement did deliver major improvements in terms and conditions for financing Greek public debt. There will be a significant extension of average maturity of all loans and a lowering of interest rates on official loans.”

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soundoff (17 Responses)
  1. who cares let it collapses

    "Markets driven by 'fear and greed' – Fear of losing money is greed – Two evils paired together.

    August 5, 2011 at 6:03 pm |
  2. Simon

    Markets driven by 'fear and greed'

    What else is new? Weren't they always? Isn't that hte whole point?

    August 5, 2011 at 7:02 pm |
  3. marcus

    no need for al quaida to bother fighting us troops .. as these are crumbling by themselves ..
    soon they will need your afghan or even somali donation .. to keep them afloat ..
    if not ..hurricanes will finish them

    August 5, 2011 at 7:32 pm |
  4. Joe Murphy

    The EU won`t let the Euro collapse because if it does collapse, it would be a possibly fatal blow to the European project as a whole. So they ain`t gonna let it happen.

    August 5, 2011 at 9:19 pm |
  5. Felix

    Fear and Greed, the evil rulers of this world.

    August 5, 2011 at 10:47 pm |
  6. khumalo Onisimo

    So much for effective Why is it that no one sees the problems coming

    August 5, 2011 at 11:37 pm |
  7. Smartie

    Fear and greed,...
    Finally someone nailed it.

    August 6, 2011 at 12:23 am |
  8. Paul Johnston, PhD Economics

    The bailout has been a massive farce by EU Bankers and Politicians in the FRAUD OF THE CENTURY!
    The Greeks, Italians, Portuguese should have never been allowed to have the Euro & are now causing it to fail.

    August 6, 2011 at 5:36 am |
  9. Bonita

    I realy feel sorry for those who spend their lives watching the numbers, desiring the numbers and worrying over the numbers and then find themselves on the death beds with only the air-headed, greedy family members left in this world... Watching, desiring and worrying over the stars are a lot more meaningful!

    August 6, 2011 at 5:37 am |
  10. Bonita

    CNN, I'm just trying to prvent the suicidal people from having the willful despair. Please post my comments.

    August 6, 2011 at 5:38 am |
  11. Bonita

    America's fear is a joke. No one can starve there. America has no idea what real sufferings are except for the self-imposed ones. Americans never suffer from external causes, unless they are missionaries or soldiers.

    August 6, 2011 at 5:41 am |
  12. Bonita

    CNN, USA needs the voice from the past. POST MY COMMENTS!!

    August 6, 2011 at 5:42 am |
  13. Bonita

    Ah, it's so boring here. Where are all the Chinese people?

    August 6, 2011 at 5:43 am |
  14. Bonita

    Americans should study on the conditions of Holocaust and North Korea and Somalia. They'll find there is no reason to be sad or fear on the soil of USA. The Jews wasted educating Americans through the movies.

    August 6, 2011 at 5:46 am |
  15. Bob

    It's time for the world to de-leverage, both governments and individuals. Let's get back to a state where prices and credit ratings reflect economic productivity, not monetary policy.

    August 6, 2011 at 10:15 am |
  16. WILDERNESS

    F your money. F your fears. F your Greed.
    And F you.

    Have a nice day!

    August 7, 2011 at 7:33 am |
  17. h4x354x0r

    Greed, that the oligarchs always want more; and fear, i.e. their "uncertainty", that they don't have enough. That story about the goose that laid golden eggs was written for a reason, and if the wealthy oligarchs end up strangling the economy out of greed, they'll find out there's no gold in this dead goose, either. That will level the playing field, without any liberals or taxation.

    August 8, 2011 at 12:24 am |

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