ECB working on emergency scenario if Greece exits, claims senior official | WPN World People News

The European Commission and the European Central Bank are drawing up contingency plans in the eventuality of Greece abandoning the euro, Trade Commissioner Karel De Gucht said in an interview published Friday.

In the first admission of an emergency plans being worked on, the senior European Union official told Flemish newspaper De Standaard that the ECB and the commission are "working on emergency scenarios in case Greece doesn't make it."

De Gutch said it was imperative Greece follow through on its economic overhaul and remain within the currency union.

"There is no alternative. Greece must stick to the deals that have been agreed. That's the only rational option for the country," the paper reported him as saying.

Despite troubled indications including the Greek vote on May 6 against austerity measures, the official cautiously voiced the optimism that "Greece will stay in the monetary union."

European Economics Commissioner Olli Rehn however refuted De Gucht's comments about the contingency plans, saying: "We are not working on the scenario of a Greek exit. We are working on the basis of a scenario of Greece staying in."

A commission spokeswoman has also denied the report of a contingency plans for a Greek exit being worked on.

The "immutable preference" is for Greece to stay in the currency bloc, the spokesman said, echoing comments voiced by ECB President Mario Draghi earlier this week.

The Greek elections have put a question mark on the country's ability to meet conditions of its bailout deal with international lenders, potentially cutting off the financing needed to keep the country afloat and stall a potential exit from the 17-nation euro zone.

Greece recently completed the biggest debt write-down in history.

De Gucht said there is "no margin" for concessions in the event of the anti-austerity parties gaining an upper hand in the fresh Greece elections next month.

He did not agree with the fears expressed by many experts that a possible Greek exit from the eurozone may spell the demise of the currency bloc arguing that the chaos such an action would lead to in Greece would deter other nations.

Source: Europe News.Net