The leaders of France and Spain headed a last-ditch diplomatic push today to get German Chancellor Angela Merkel to back a financial safety net for Greece as a European Union summit opened in Brussels, according to dpa. Merkel has emerged as the make-or-break player in the EU's debate on whether and how to offer Greece support, clashing head-on with France, Spain and the European Commission. The row has eclipsed the summit's official agenda of economic reform. "The euro is an extremely important currency, it's important to have a strong currency. It's important to have a clear European solution," Spanish premier Jose Luis Rodriguez Zapatero said. Greece wants the promise of an emergency loan - as distinct from a loan itself - to reassure markets that it will not default. Greek premier George Papandreou hopes that that will convince lenders to drop the over 6-per-cent risk premium they charge his government. "We need to put the loaded gun on the table to make sure that the markets will respond in a positive manner," he said last week. Spain, France and the commission, the EU's executive, back that call, with Zapatero and French President Nicolas Sarkozy demanding a eurozone summit on the fringes of the EU summit to settle a deal. "It's unthinkable that we bring together European leaders without speaking on this issue and reaching consensus, because it's an urgent problem that we have to solve and I hope that eurozone leaders will find a solution," commission chief Jose Manuel Barroso said. But Merkel insists that any loan offer could only come once Greece has exhausted all other options for raising money, and only with the support of the International Monetary Fund (IMF). "I propose that we look at the idea of a combination of IMF and bilateral aid," she told journalists ahead of Thursday's summit. The idea of Germany paying to rescue Greece from the consequences of years of financial mismanagement has outraged German opinion, less than six weeks before crucial regional elections. Merkel on Thursday echoed that sense of outrage, insisting that Germany would never again tolerate fraud in any euro state. "No trickery can be allowed," she said. Greece is widely believed to have faked its budget statistics both to get into the euro and to avoid reproaches from Brussels after it joined. In apparent answer to the German concerns, Zapatero stressed that "This is not a question of giving Greece money, it's a question of lending Greece money which it will have to pay back at interest." At the same time, he conceded that there was "no reason why we shouldn't bring in the IMF," as long as the EU was in control.
