If a deal is going to be struck that avoids a Greek exit from the euro zone and restores confidence in the currency bloc, it is going to have to be big and convincing to markets. As one UK politician put it last week, the German Chancellor needs to fire a “Big Bazooka” if she is to save the euro zone from its current crisis.
Angela Merkel made it clear in a CNBC interview last week that she wants Greece to stay in the euro , and she indicated that a growth plan for Europe is on its way as long as troubled nations stay the route with austerity. "On the one hand we have the pillar of sound fiscal policy, and the second pillar will then be the growth component,” the chancellor said.
A few days later, Merkel met with other G8 leaders at Camp David and agreed to a communiqué that pointed toward a new growth strategy but made it clear that Greece needs to do what it promised in terms of debt restructuring.
"We commit to take all necessary steps to strengthen and reinvigorate our economies and combat financial stresses, recognizing that the right measures are not the same for each of us," said the G8, which also singled out Greece: "We reaffirm our interest in Greece remaining in the euro zone while respecting its commitments.”
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