Romano Prodi: Greece`s Crisis Has Bottomed Out

Romano Prodi, the former European Commission President during his interview told the reporters that Greece`s financial slump has already bottomed and there is no concern on further collapse of the European united currency system resulted from budget deficit in Greece. According to Mr. Prodi, the euro will strengthen in the Forex currency market as the other Euro-bloc countries avoid following the Greece`s way. The problem with shortfall of Greek budget deficit seems to be over now.

The deficit of budget of Greece already exerted a bad influence on the 16-nation economy as the euro tumbled to its lowest level in last 10 months.

Recently Greek officials announced they do not need cooperation with other European countries as Greece`s economy has enough strength to overcome a 12.7% budget deficit. The government decided to cut spending and to increase taxes. These plans were treated with hostility by working unions staging a series of strikes around the country.

Romano Prodi, who managed to cut Italy`s budget deficit from 7 percent to 2.7% when he was Italian Prime Minister believes that concerns over Greece debt will be subdued soon and euro will pare its losses versus other major Forex currencies.

Solution for Greece`s Budget Deficit Is Found

Today European leaders came to the agreement aiming to help resolve the problem of 13% budget deficit in Greece.

According to this agreement, Greek government will receive lending facilities. Thus, the financial crisis in this country may be avoided. The EU leaders pledged to take “determined” action to struggle against the worst crisis in 11-year history of Euro. Greece's attempts to cope with its exploding debt has added to worries that the country might default. The EU President Herman Van Rompuy said: “We fully support the efforts of the Greek government and their commitment to do whatever is necessary including adopting additional measures.”

In order to safeguard financial stability in the region the EU leaders pledged to bail out Greek economy as here the problem of one euro-zone country becomes the problem of all. This step is considered historic in last ten years since the single currency was introduced. Euro zone leaders had hoped to keep Greece off the summit agenda. But they had to include it as worsening market conditions showed that Athens's problems could spill over to other EU countries.

Next week, the Ministers of finance of the EU countries will gather to discuss issues over Spain and Portugal also suffering from high budget deficit and increasing unemployment.

The agenda including all major economic events can be found at Economic Calendar Page.