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UPDATE 1-Euro zone states considering help for Greece -report

Published 01/28/2010, 08:07 AM
Updated 01/28/2010, 08:12 AM

(Adds details, Economist blog)

PARIS, Jan 28 (Reuters) - Euro zone countries, including France and Germany, are studying ways of helping Greece resolve its budget problems but will only act if Athens does more to clean up its accounts, Le Monde newspaper reported on Thursday.

Quoting unnamed senior officials, Le Monde said several governments were holding consultations to look at ways of providing financial aid to Greece.

Amongst the possible solutions were bilateral loans between various European Union countries and Greece, or else to bring forward the release of EU structural funds, the paper said.

It quoted "several senior officials" as saying that the euro zone "was ready to help Greece if the country assumed its responsibilities."

Financial markets are concerned that Athens will not be able to service its heavy debt, putting pressure on the euro currency and even raising speculation as to whether Greece could be forced out of the euro zone.

In its Brussels-datelined story, Le Monde quoted an unnamed government source as saying other euro zone countries did not want to see Greece seek help from the International Monetary Fund.

"It is a question of credibility for the euro zone," said the source. "The IMF might want to impose monetary conditions. Euro zone states do not want this, they want to preserve the independence of the ECB," the source added.

The paper added that any rescue package would be highly complex because European Union treaties excluded any such moves.

Separately, a blog posting on the Economist website said EU officials were considering ways to help Greece. (Reporting by Crispian Balmer; Editing by Toby Chopra)

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