BRUSSELS (MNI) – The European Central Bank maintains its position
that eurobonds with a “joint and several” guarantee would not be
appropriate given the present circumstances in the European economies,
ECB president Jean-Claude Trichet said Monday.
“In the ECB, as you know, we are not in favour of European bonds in
which the European countries would be joint and several. We don’t
consider it is something that would be appropriate in the present
circumstances,” Trichet told the European Parliament’s Economic and
Monetary Affairs Committee on Monday.
He also said the Greek economy was in a better position than it was
before the government introduced its recovery programme, and after its
negotiations with the ECB, the IMF and the European Commission.
“The situation today is objectively better in terms of seriousness
and stability than it was at the time of no programme,” Trichet said,
adding that it was objectively “much worse than it is today.”
Asked what the consequences would be if Greece left the Eurozone
temporarily, Trichet said it was not his working assumption but that it
would not be hard to imagine what would happen.
Returning to the topic of Europe’s burgeoning budget deficits, he
said that for the G7 economies, the average budget deficit was about
10.5-11 percent of GDP while for Europe as a whole the deficit only
amounted to about 6.5-7 percent of GDP.
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