Millennium Post

Debt-stricken Greece tops G8 agenda

Debt-stricken Greece topped the world agenda on Friday as leaders headed for talks with US President Barack Obama on preventing a chaotic eurozone exit which could hit hopes for sustained growth.

Leaders of the Group of Eight (G8) top economies come together as Greece faces its second general election in just six weeks, putting its eurozone future in doubt and dragging down Spain, where the government is struggling to keep its banks afloat.

European stock markets opened lower after heavy losses in Asia overnight but then bounced, including in Madrid - a sign of the extreme volatility as the crisis whiplashes investors who want safety above all.

Money flowed again into Germany, seen as the safest of bets against the risk of contagion from Greece, with investors worried that if Spain needs a bailout, the EU will be hard put to ensure enough rescue funding.

Germany said it had no reason to doubt that Spain can help its banks without seeking outside aid. German Chancellor Angela Merkel called for a stable Greek government to be formed quickly after elections on 17 June in a telephone call with President Carolos Papoulias.

Merkel 'repeated the German position that we are waiting for the elections and that it is the wish of all European partners ... that a government is formed as quickly as possible,' a spokesman said.
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