UK 'should not join Greek bailout'

Greek police struggle to restore order during anti-cuts demonstrations (AP)
12 April 2012

A fresh financial bailout for Greece should only involve countries which have joined the single currency, Government officials have said.

The UK was not involved in the original bailout for Greece last year, which was funded via bilateral loans within the single currency area.

Germany and France have already signalled there is no reason for London to pay a share of any repeat bailout in the face of a worsening Greek economic crisis.

And ahead of talks between EU finance ministers Prime Minister David Cameron's official spokesman said: "I don't want to speculate on what might happen.

"There is no proposition on the table on this and we are not part of those arrangements, those bilateral arrangements."

In Brussels a Government official commented: "The UK is of the view that the Greek problem is to do with the eurozone. The original problem was resolved with bilateral loans, put together for Greece last May and it is appropriate that only those involved in the original bailout should be involved - the UK will not be involved."

There was a "theoretical risk", he said, that if a second bail-out package were agreed, some may want to use a bailout fund set up after the Greek crisis last year, which involves contributions from all EU countries.

But he added: "We do not get the benefits of the euro, as we are not members, so we should not be involved (in a bailout)."

EU eurozone finance ministers are due to agree next week on the latest payment from the 110 billion euro (£96.5 billion) Greek bailout approved in May last year. And they are also under pressure to settle the terms of a second bail-out, following the failure of existing Greek austerity measures to revive the economy and close the Greek national deficit gap.

Chancellor George Osborne will be attending the talks in Luxembourg, but he will expect Germany and France to stick to their public acknowledgement that the issue does not involve the UK.

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