France's Hollande backs Greece but urges credible reform

Francois Hollande (3rd right) meets Greek PM Antonis Samaras (3rd left) in Paris on Saturday.

Story highlights

  • Francois Hollande says Greece must "demonstrate credibility" in its commitment to reform
  • PM Antonis Samaras says Greece will "will do what it takes to get out of the crisis"
  • The two leaders meet in Paris for the first time since each was elected
  • Greece is at the center of the eurozone's long-running debt crisis

French President Francois Hollande restated his country's support for debt-stricken Greece Saturday, but stressed that it must live up to its reform commitments.

Hollande spoke alongside Greek Prime Minister Antonis Samaras in Paris, following the first meeting between the two leaders since their respective elections this summer.

Hollande said there was "no question" that Greece should remain in the eurozone, the 17-nation single currency area, and that two-and-a-half years of speculation over its potential exit should end.

But, he said, Greece has to meet its reform targets.

"Greece must stay in the eurozone and then again demonstrate credibility in its program, as well as the will of its leaders to get through this process and to make sure it is bearable for its people," he said.

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Hollande also recognized the efforts already made by Greece, whose people have had to endure painful austerity measures and five years of recession.

Samaras, elected three months ago, is on a two-day visit to Germany and France as he seeks to negotiate some breathing room for his debt-burdened government.

The meeting with Hollande had been a chance to discuss "the big threats, the big challenges but also the common prospects that Europe is facing," Samaras said.

He reiterated his government's resolve to take the steps needed to keep Greece afloat.

"There are those who are speculating that Greece will not make it. I am here to reassure the French president that Greece is, today, determined to make it. And will make it," he said.

"It will do what it takes to get out of the crisis and will remain, as the French president also said, in the eurozone and once again find its rightful role in Europe."

Success by Greece will help show that Europe can "overcome its problems and, united, go forward," he said.

Samaras agreed that structural reforms were needed but stressed too the importance of development, saying that without it the economy would struggle to recover from recession.

He added that the Greeks are a proud people, who "don't like to borrow and depend on borrowed money," a point he also made after his talks with German Chancellor Angela Merkel Friday.

Greece's international lenders, known as the troika, are due to complete a report on the country's finances next month, on which rests Athens' continued access to international bailout funds.

Greece has been at the center of Europe's long-running debt crisis, which is now threatening to envelop Spain and Italy and has shaken the global financial system.

Even after a historic restructuring in March, Greece is still struggling to cope with a punishing debt load as its economy remains mired in a years-long recession. Many investors and economists believe there is at least a 50% chance that Greece will leave the currency union, or be forced out, this year.

However, speaking Friday in Berlin, Merkel said she was "absolutely convinced" that Samaras and his partners in Greece's coalition government were doing everything they could to solve the nation's economic problems.

The chancellor said twice that she wanted Greece to remain a member of the euro currency union. But she also argued that the euro crisis stemmed from a lack of trust, which she said must be rebuilt.

"I have made clear today that we absolutely expect from Greece that the promises which were made will also be kept, and implemented," said Merkel. "That actions will follow their promises."

Greece is widely believed to have gone off-track with its program following the political turmoil of this year's elections, which left the nation without a fully functioning government for weeks.

However, Samaras and his coalition partners have reportedly identified the roughly €11 billion in additional budget cuts that it needs to secure the latest installment of bailout money.

Troika officials are set to return to Athens in early September to complete their review. That means eurozone finance ministers will probably not make a decision on Greece's bailout money until they meet on October 8.