THE financial stand-off between Greece and the eurozone is fast becoming the largest single threat to the global economy, George Osborne has warned after meeting the Greek Finance Minister in London.
No 10 made clear that the UK Government's position on Greece's attempt to have half of its mountain of debt written off was that countries had to "fulfil their international obligations"; in other words, pay up.
Already, Angela Merkel, the German Chancellor, has ruled out any cancellation of Greece's debt, saying creditors had already made concessions. Germany is Europe's largest economy but also Greece's biggest creditor.
Greece still has a debt of €323bn or £244bn, which is about 175 per cent of its gross domestic product despite some creditors writing down debts in a renegotiation in 2012.
After his meeting with Yanis Varoufakis, the Chancellor said: "It's clear that the stand-off between Greece and the eurozone is fast becoming the biggest risk to the global economy and it's a rising threat to our economy at home.
"In Europe as in Britain, now is the time to choose competence over chaos. I urged the Greek Finance Minister to act responsibly but it's also important that the eurozone has a better plan for jobs and growth. We have that plan in Britain and in these uncertain times, now is not the time to abandon that plan."
Mr Varoufakis, an economist, is currently on a tour of European capitals, claiming his priority is the well-being of all Europeans.
At the weekend after talks with his French counterpart, the Greek Finance Minister insisted a new debt deal was needed within months. He has ruled out accepting more bailout cash.
Last month, Syriza, the left-wing, anti-austerity party won Greece's general election with a pledge to write off half the country's debt. Alexis Tsipras, the country's new Prime Minister, has said he is confident Athens will reach a deal with its creditors.
The so-called "troika" of the European Commission, the IMF and the European Central Bank agreed a €240bn or £179bn bailout with the previous Greek government.
Time is of the essence as Greece's current loans programme comes to a close at the end of this month. A final bailout tranche of €7.2bn or £5.4bn is still to be negotiated.
The new Syriza-led government has already begun to scrap a number of austerity measures, including the previous administration's programme of privatisations.
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