Greek crisis overshadows G20 talks

Eurozone’s largest members hold ‘intense’ talks about Greek crisis before G20 summit begins.

Leaders from the world’s 20 leading economies have started their meeting in Cannes amid turmoil in the eurozone.

Reports from Greece suggest that George Papandreou, the prime minister, is to resign and offer to form a government of national unity.

This morning, leaders in Cannes held an emergency eurozone ‘mini-summit’ as the crisis threatened to spiral out of control once more.

The leaders of France, Germany, Spain and Italy held talks with Herman Van Rompuy, president of the European Council, and José Manuel Barroso, president of the European Commission, for more than two-and-a-half hours.

The meeting, which over-ran and had to be concluded only because the G20 summit proper was about to start at 1pm, was “intense” and had to be suspended several times for bilateral discussions and telephone calls, an official close to the discussions said.

Leaders also interrupted their meeting to keep abreast of the unfolding situation in Greece.

A press conference planned for the end of the meeting had to be cancelled because of the time constraints. Van Rompuy and Barroso may now address the media later this afternoon. 

Papandreou returned to Athens in the early hours of this morning after a meeting with French President Nicolas Sarkozy, German Chancellor Angela Merkel, Van Rompuy and Barroso in Cannes last night.

After the meeting, Merkel and Sarkozy said a planned referendum on Greece’s latest austerity measures was effectively a vote on eurozone membership.

They said that Greece’s €8bn European Union/International Monetary Fund loan would be withheld until and unless the referendum delivered a positive outcome.

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