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Greece eurozone exit script denied

 

Geoff Meade
Tuesday 12 June 2012 14:20 BST
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The European Commission denied today that it was preparing a "script" for Greek exit from the eurozone.

In the build up to a crucial Greek general election vote on Sunday which could decide the country's financial future in the euro club, a spokesman insisted EU contingency plans were all based on continued membership.

"We have no plan providing for Greece to exit the eurozone. The Commission is not working on a Greek exit plan of any kind." he said.

"If there are some persons in the member states or elsewhere examining the possible repercussions of such a scenario or of any particular scenario that is their business, but our job is to work on the basis that Greece will stay within the euro and to ensure, as guardians of the treaty, that the treaty is respected.

"Others are doing speculative scenarios - we are providing legal clarification on these elements. That does not mean that the Commission is working on a scenario. That is not our job."

He added: "We in the European Commission are not scriptwriters for disaster."

Asked if Greece could close its borders to prevent a flight of capital if the election triggers a run on Greek banks, the spokesman said there was an EU Treaty provision that national borders within the "Schengen" area of EU countries could be closed to protect "public order and security".

But he said there was already case law in the European Court of Justice excluding "economic security" from the provision.

The spokesman emphasised that plans the Commission is drawing up for a European "banking union" are being prepared on the basis that all 27 member states will be involved - even though Chancellor George Osborne has made clear the UK would not take part:

"The Commission will continue to put proposals regarding banking union for the 27 member states.

"We are the Commission of the EU and therefore we always seek an agreement between the 27 member states because this is what is required under the Treaty.

"Depending on the position of each member state, including those who have an opt-out from accession to the euro, if they wish not to engage in one particular proposal, then the Commission will see if there is a possibility to go for enhanced cooperation.

"But we are not there yet so we continue to stick to the most ambitious approach, which is a banking union for 27 member states."

Commission president Jose Manuel Barroso has called for all 27 EU governments to submit their big banks to a single cross-border superviser as part of a banking union to be introduced as early as next year as part of broader European economic integration to help tackle the crisis.

PA

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