Monti, Hollande present united front on crisis

Italian Premier Mario Monti and French President Francois Hollande said they had "synergy and unity of objectives" after meeting for talks in Rome on Tuesday during what is set to be a crunch week for the eurozone debt crisis. The financial markets are anxiously waiting for Thursday's policy meeting of the European Central Bank, when President Mario Draghi is expected to reveal plans to buy the state bonds of Spain and Italy to lower their borrowing costs and ease the crisis, despite resistance from Germany's central bank. "If we want to restore confidence, we must not have doubts about the eurozone," Hollande told apress conference after the talks. Hollande identified three steps for solving the eurozone crisis: applying the decisions made at the EU Council summit in June, solving the problems of Greece and Spain and creating the banking union, which he hoped would be addressed at the next European Council meeting on October 18-19. On the first point Monti said that Italy and France would work to ensure the measures agreed by European leaders in June to lower the borrowing costs of the countries at the centre of the eurozone debt crisis are fully applied. He added that the European Union must recognise the efforts individual countries are making to put their economic houses in order by helping them lower their borrowing costs. "It's necessary that, as progress is gradually made in economic policy, there should be recognition from the EU itself so that the great obstacles of the (bond) spreads, that have nothing to do with the performance of the economy, do not persist," the Italian premier said. Concerning the struggling Greek economy Hollande said he was in favour of granting the country more time to meet its economic targets if the troika of international creditors - the European Commission, European Central bank and International Monetary Fund - overseeing application of its bailout conditions gave a positive appraisal of its progress. The French president said the plan could be "re-applied" without any need for another bailout. On the separate issue of the controversial high-speed rail link between Turin and Lyon, Monti described the project as "fundamental" and reiterated the commitment of France and Italy to its completion. In July Paris daily Le Figaro reported that the French government was considering reviewing and possibly scrapping 10 high-speed railway lines, including the Turin-Lyon link, due to high costs and a drop in freight traffic as a result of the recession. France subsequently confirmed its commitment to the project but said a new funding agreement was required.