BRUSSELS (MNI) – European Commission President Jose Manuel Barroso
Wednesday told EU governments that more action to boost economic growth
was essential to ending the Eurozone’s sovereign debt crisis.

“More and more, our partners and international investors are asking
the following question: what is Europe’s medium and long-term prospect
for growth? It is clear that we will not overcome this crisis without a
credible response to the question of growth,” Barroso said in
Strasbourg.

“If we are serious about overcoming the crisis, we must be serious
about adding decisive action on growth to the decisive action already
underway on financial and fiscal consolidation,” he said, adding that
action in the Eurozone so far has been “uneven and in some cases
insufficient.”

“Without implementation of a credible response to the Euro area
crisis, our prospects for economic growth will not be achieved,” Barroso
said.

The limited room for fiscal stimulus in most EU countries means
that growth will have to come from structural reforms to increase
competitiveness and from targeted investments, he said.

Barroso’s call on growth echoed a similar message from EU Council
President Herman Van Rompuy Tuesday, who said EU leaders would tackle
growth and employment issues at their summit in Brussels on January 30.

The emphasis on growth coming out of Brussels, though not entirely
new, follows its recent criticism of Standard & Poors’ decision to
downgrade the credit rating of nine Eurozone countries, which the
European Commission said mistakenly interpreted the EU’s crisis strategy
as solely based on fiscal austerity.

Barroso also urged a “lasting solution for Greece,” in which talks
between the government and international private sector bondholders are
expected to resume Wednesday.

A spokesman for the Commission said that the EU’s executive
institution, which is not participating in the negotiations, hoped for
an agreement “as soon as possible.”

The agreement would have to be voluntary as agreed by EU leaders in
October last year, the Commission spokesman said.

–Brussels bureau: +324-9522-8374; pkoh@marketnews.com

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