THE euro is doomed to collapse in the wake of the financial turmoil in Greece!THE euro is doomed to collapse in the wake of the financial turmoil in Greece, Jack Straw said yesterday.
His stark message came as the International Monetary Fund warned that the global economy could be devastated unless the Greeks are rescued.
Ex-Foreign Secretary Mr Straw said British ministers need to make emergency plans “since the euro, in its current form, is going to collapse.”
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He told Parliament: “What the Government should do instead of sheltering behind the complacent language, weasel words that ‘it is not appropriate, we should not speculate’ is recognise that this eurozone cannot last.
“And it is the responsibility of the British Government to be open with the British people now about the alternative prospects.”
MELTDOWN
The IMF said the EU must take immediate steps to save Greece or there would be a domino effect throughout the eurozone leading to a second global financial meltdown.
It warned: “With deeply intertwined fiscal and financial problems, failure to undertake decisive action could rapidly spread the tensions to the core of the euro area and result in large global spillovers.”
Alarm bells rang yesterday after EU finance ministers blocked a second rescue package for Greece.
Europe is refusing to sign off a £10billion loan until Greek Prime Minister George Papandreou introduces more austerity measures.
The parliament in Athens will today decide whether to accept the additional £24billion in spending cuts and economic reforms.
There are fears that if the package is voted down, Greece could default on its debts and pull out of the euro. This would spark an international financial crisis and could send the fragile economies of Portugal, Ireland and Spain into meltdown.
Labour MP Gisela Stuart warned that Britain was not “isolated” from such a catastrophe.
George Osborne flew to Luxembourg yesterday for an emergency meeting of EU finance chiefs.
DEBTS
The Chancellor insisted Britain would not be part of any fresh bailout package for the Greeks.
But the UK could be liable for at least £1.3billion if Athens defaults on its debts and the IMF steps in.
Greece has already had a bailout worth £96billion from the EU and is demanding another £100billion rescue package.
Read more: http://www.mirror.co.uk
