ID (AFP) - Eurozone finance ministers are to discuss Greeces debt crisis on Sunday, a Spanish government official said Saturday, after Foreign Minister Miguel Angel Moratinos expressed hoped of a solution.
The ministers will hold a conference call at 2:00 pm (1400 GMT) with the aim of finalising aid mechanisms for Greece, the Spanish official said. Speaking in Paris, Moratinos said, I am quite optimistic that we are again able to show solidarity and above all send a message to the speculators that the eurozone is strong and firm.
European leaders agreed last month to provide last-resort assistance to Athens backed by the International Monetary Fund.
On Friday officials of the 16 countries using the euro agreed to levy interest rates below the market level if Greece is forced to seek the emergency aid. Amid growing speculation that a rescue deal was in the offing, Greek Prime Minister George Papandreou held talks with several EU leaders late Friday.
The talks by phone involved EU President Herman Van Rompuy, European Central Bank chief Jean-Claude Trichet, EU Commission head Jose Manuel Barroso and eurozone finance chief Jean-Claude Juncker.
Moratinos said Spanish Prime Minister Jose Luis Rodriguez Zapatero, whose country currently chairs the European Union, and French President Nicolas Sarkozy had also been in talks with Van Rompuy, Barroso and Juncker. A lot of work has been done this weekend, he said, adding that the aim was to come up with a concrete mechanism to save Greece.
With the news appearing to be going in Greeces favour, the yield on the benchmark 10-year Greek government bond fell back sharply on Friday to just over seven percent in late trade.
That is still very high compared with German bonds, for example, but a large improvement and with the prospect that the eurozone accord could see it go lower still if Athens can get cheaper funds from the EU. Earlier Friday, Van Rompuy gave Greece his backing, telling journalists from a handful of European newspapers: The Greek government is courageous and is breaking with the past. We would be ready to intervene if the Greeks ask us to. Sarkozy said the EU was ready to activate its rescue scheme at any time to come to Greeces aid, after discussions with Italian Prime Minister Silvio Berlusconi.
Germany also said that the EU-IMF rescue scheme could be activated quickly, although government spokesman Michael Offer again stressed that Greece could solve its problem by focusing on budget cutbacks.
However, Fitch Ratings took a hard line, saying it had downgraded Greeces debt ratings because of the challenge the country faces in managing its public finances.
Fitch said it cut Greeces long-term foreign and local currency Issuer Default Ratings to BBB- from BBB+.
It also slashed the credit rating of five banks, including National Bank of Greece, which was reduced from BBB to BBB-. Greece has faced increasing difficulties in raising fresh money on financial markets to cover its obligations and ratings downgrades normally increase a countrys borrowing costs.
Fitch warned that it was vital that the Greek authorities import credibility from external institutions, underpinned by a credible commitment of financial support.
Greece has to find around 11.5 billion euros (15.5 billion dollars) by next month to cover its obligations and another 32 billion euros over the balance of the year.