Friday, September 16, 2011

Geithner warns EU of ‘catastrophic risk’

Geithner warns EU of ‘catastrophic risk’
By Joshua Chaffin and Alex Barker in Wroclaw and Kerin Hope in Athens

The US Treasury secretary told Europe’s leaders to stop bickering and take control of the debt crisis that has brought “catastrophic risk” to financial markets.

In a blunt warning that reflected Washington’s growing concern, Timothy Geithner urged European leaders to halt a months-long clash with the European Central Bank and argued that the EU’s growing reliance on foreign lenders would imperil the bloc’s ability to control its own destiny.

“What is very damaging [in Europe] from the outside is not the divisiveness about the broader debate, about strategy, but about the ongoing conflict between governments and the central bank, and you need both to work together to do what is essential to the resolution of any crisis,” Mr Geithner said on the sidelines of a meeting of eurozone finance ministers in Wroclaw, Poland on Friday.

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