Wayne Swan warns of euro crisis 'marathon'

TREASURER Wayne Swan is not letting up on criticism of European nations while warning remedial action to resolve the sovereign debt crisis there will be a marathon.Mr Swan also reaffirmed Australian financial support for the International Monetary Fund so it could deal with potential vulnerability facing the global economy.European finance ministers meet tomorrow amid concerns the G20 leaders summit in France failed to agree on the future direction for Europe.The only successes being claimed were convincing Greece to back down from a referendum on its bailout and Italy agreeing to get its budget back into surplus in 2012 and providing regular reports on its efforts to stave off a crisis.Europe still faced a difficult road ahead which meant that global volatility would continue for some time to come, Mr Swan said today.“Determined, consistent and continuing action is required by the Europeans to deal with the debt crisis and restore growth,” the Treasurer said in his weekly economic note.“This will be a marathon, not a sprint.”Mr Swan lamented that European nations had ignored the necessary structural reforms over a long period.They also had allowed their budget positions to gradually deteriorate to an unsustainable position, he said.“It's only in the past month that Europe has really faced up to the enormity of the challenge,” Mr Swan said, adding the region's leaders had “dithered” when the debt crisis first emerged 18 months ago.G20 finance ministers, including Mr Swan, are set to meet as early as December to flesh out the details of how much the IMF's resources will be bolstered.Australia and China are among a number of nations to pledge extra resources for the IMF, while steering clear of the European financial stability facility, set up to stop the spread of the debt crisis.Any money that Australia provided would be as a loan that would be repaid in full with interest, Mr Swan said.“That means it doesn't affect the budget bottom line,” he said.But the opposition says the move increases Australia's exposure to the debt crisis and any loan defaults.“If we underwrite or loan monies that are not able to be fully paid back, ultimately it will be the taxpayer that will suffer,” frontbencher Eric Abetz said.Finance Minister Penny Wong was scathing of the Coalition's stance, labelling it “irresponsible” and “inconsistent”.She took aim at Opposition Leader Tony Abbott, saying his position on the issue was more akin to what Pauline Hanson would say.Senator Wong said the European sovereign debt crisis was not the only issue of concern.“We also need to look at the drivers of global growth in the medium term, including rebalancing the global economy,” she said, adding there were a number of things in the G20 summit communique which went to that.“But much more needs to be done.”