Wednesday, November 16, 2011

The U.S. Treasury Secretary says Europe is progressing despite the challenges

Treasury Secretary Timothy Geithner said on Wednesday that despite the “terribly difficult challenges” facing Europe, European leaders to halt the progress of the debt crisis.

Geithner insisted that the necessary measures “are among the possibilities” of Europe, but recognized that there must move faster and with more momentum.

The European challenge is to achieve a balance between “the reforms needed to boost growth and solve the fiscal problems of funding,” he told a conference organized by the business newspaper The Wall Street Journal in Washington.

Especially important, according to the U.S. Treasury secretary, to get “affordable financing rates” in those countries that are threatened by a rising borrowing costs such as Italy and Spain.

The statements of U.S. Treasury chief occur on the same day that several peripheral European countries such as France, Belgium and Austria, saw their risk premium also shot up to levels unknown in the era of the euro, pressured by markets .

The debt crisis in Europe has become a crisis of confidence without the recent changes of government in Italy and Greece, or the prospect of general elections on Sunday in Spain, have managed to calm the markets.

However, Geithner reiterated his confidence that Europe will leave the complicated situation in which it is located.

“The challenges are terribly complicated, but are within the scope and ability of Europe. They must find a political solution that the curves fall before the market,” he said.

Geithner said the solution is to use economic instruments and institutions, national governments, the European Central Bank (ECB) and International Monetary Fund (IMF) of “joint and coordinated manner.”

Although stressed, the “primary role is for national governments.”

United States notes with concern the financial crisis in Europe and Geithner has been recognized in more than one occasion that the weak U.S. economic recovery has been “significantly affected” by the financial turmoil across the Atlantic Ocean.

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