G8 leaders back Greece amid tensions

G8 leaders said they want debt-stricken Greece to stay in the eurozone at a Camp David summit as the group papered over deep-seated divisions about how best to tackle the eurozone crisis. With the future of Europe's currency union in doubt, leaders of the world's largest economies called on Greece on Saturday to stick to the terms of a massive EU-IMF cash-for-reforms bailout, which is hanging by a thread. "We agree on the importance of a strong and cohesive eurozone for global stability and recovery," a final G8 joint communique stated. "We affirm our interest in Greece remaining in the eurozone while respecting its commitments." May 6 polls saw Greek anti-austerity parties on top, casting doubt on Athens' commitment to reforms and raising the question for its partners of whether to ease up on austerity or turn off the bailout spigot. The latter course would almost certainly lead to a Greek default and exit from the eurozone, sparking global panic, and tensions are rising ahead of new polls June 17 which are not guaranteed to produce a viable government. The latest opinion poll on Sunday in Greece gave the radical left Syriza party, opposed to the bailout, 28 percent of the vote, with the conservative New Democracy, which supported the deal, on 24 percent. A poll Friday put Syriza in second with 21 percent, behind New Democracy on 23.1 percent, but sentiment is volatile as most Greeks want to keep the euro but cannot stomach endless austerity after years in recession. Syriza head Alexis Tsipras is meanwhile due to visit Paris and Berlin next week for talks with leftist European leaders, including Jean-Luc Melanchon, who polled strongly in the French presidential elections which brought Francois Hollande to power earlier this month on a pledge to support growth. The drama in Greece and growing voter unease in European powerhouses France and Germany pushed the eurozone crisis right to the top of the G8 summit agenda. Obama noted leaders' agreement that growth and jobs must take precedence over austerity. "As all of the leaders here today agree, growth and jobs must be our top priority," Obama said at the conclusion of the meeting. "The direction the debate has taken recently should give us confidence that Europe is taking significant steps to manage the crisis," he said. Ahead of the meeting, Obama came out in favour of French and Italian efforts to put the focus on growth, rather on German-favoured austerity policies. Critics say two years of single-minded focus on debt reduction have fuelled rampant unemployment, brought Greece to the verge of bankruptcy and stoked crises in Italy and Spain. Any further deterioration could have costly repercussions for the US economy and Obama's chances of re-election in November, factors that perhaps spurred him to wade into European political waters. Inevitably that brought tensions with German Chancellor Angela Merkel that were evident throughout the summit but she insisted by the close that there were no differences with France. "Otherwise we would not have been able to agree on a statement," she said. The statement, however, noted "the right measures are not the same for each of us." After a meeting between Obama and Merkel, the White House was at pains to point out the president "understands just how much of a leadership role" the chancellor plays in Europe. It also stressed that growth measures would not take the place of fiscal reform but would work in tandem. Looking to the longer-term, there appeared to be broad agreement about specific European stimulus spending, funded by common European bonds -- another controversial step opposed by Berlin -- and by the European Investment Bank. "We should not just wait for structural reforms and the reduction of deficits to generate growth," said Italian Prime Minister Mario Monti. "The European Union Council (meeting on May 23) should identify concrete paths, like reinforcing the capital of the European Investment Bank, project bonds and an evolution towards eurobonds." The summit at the retreat's rustic collection of cabins in the wooded Catoctin Mountains also focused heavily on Iran and the bloodshed in Syria. G8 leaders sent a strong message to the Islamic Republic that tough energy sanctions would be firmly applied, vowing to ensure oil markets were adequately supplied and to prevent soaring energy prices. The move came days before the next round of nuclear talks between global powers and Iran in Baghdad on Wednesday. Obama said he was "hopeful" the negotiations would be productive and stressed that major powers were "unified" against Iran. The G8 also called for a "political transition" in Syria and for the end to violence that has claimed an estimated 12,000 lives. The group -- which includes long-time Syrian-ally Russia -- called for a "Syrian-led, inclusive political transition leading to a democratic, plural political system." The G8 club of developed nations includes Britain, Canada, France, Germany, Italy, Japan, Russia and the United States.