4.11.2011
By Simon Miller
The G20 has ruled out a further boost to the International Monetary Fund (IMF).
Speaking at a closing press conference, European Commission President Jose Manuel Barroso confirmed that the IMF will not be given further money to protect troubled eurozone countries.
An agreement hinged on the US as, despite pressure from the UK, President Obama was reluctant to boost funds as he believed that the eurozone had enough firepower to deal with the problem internally.
Meanwhile, the Greek finance minister Evangelos Venizelos has offical confirmed that the referendum on the country's bailout package has been withdrawn.
With Prime Minister George Papandreou facing near-certain loss in the no-confidence vote at the Greek Parliament tonight, Venizelos reportedly phoned Jean-Claude Juncker, the Eurogroup chairman, Olli Rehn, the EC's economy and monetary affairs chief, and Wolfgang Schaeuble, the German finance minister to confirm the halting of the referendum - an action that has been widely circulated around the G20 since yesterday afternoon.
With a heavy police presence in Athens. the vote is not expected to go off peacefully as opposition politicians look to form a national unity government on the back of a no-confidence win.
Speaking to BBC Radio 4's Today programme, Barroso said he expected the new Greek government would back the eurozone bail-out as already agreed.
He commented: "I believe them all the problems will be solved. What is the other option for the Greek people? Default and a real difficulty paying the wages for schools and hositals. It will paralyse the country."
Barroso added that it is up to Greece whether it would stay in the euro.
"When you're a member of the euro area you have to respect the rules. It's up to them to decide if they want to keep their position in the euro area.We would like them to stay, it's in their interests," he added.
The G20 summit also turned its attention to Italy as concerns mount over its ability to reform its public sector.
As a result, the International Monetary Fund will monitor Italy's accoutns to make sure it carries out its agreed reform programme.
This morning, German bank Commerzbank abandoned its full year profit targets, after taking a €798m (£689m) impairment on Greek assets.
Its chief financial officer Eric Strutz said that Italy had to take its share of the blame.
He commented: "The whole stability of Europe depends on whether Italy gets its act together."
Other stories you may find of interest:
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