The euro zone is working on a possible exit of Greece from the euro zone, Eurogroup head Jean-Claude Juncker said on Thursday, saying it was essential that other members of the currency union would not be damaged in such an event.
Juncker made clear he did not want Greece to leave the euro zone but, in some of the most explicit comments yet from a leading member of the currency bloc, he speculated about plans for a possible Greek exit.
Asked what would happen to German taxpayers' money if Greece were to leave, Juncker told ZDF Morgenmagazin:
We are working on the subject of how to ensure there is not a disaster for the people in Germany, Luxembourg, the euro zone. We are absolutely prepared for the situation which I describe and which I want to be avoided.
The leaders of Germany and France told Greece on Wednesday in Cannes it would not receive any further European aid until it decides whether it wants to stay in the euro zone.
German Chancellor Angela Merkel and French President Nicolas Sarkozy summoned Greek Prime Minister George Papandreou for crisis talks after he shocked his European partners and shook markets by saying he would call a referendum on planned aid.
Everything must be done to try to make sure one member of the 17-member group does not fade away but if this were the wish of the Greeks -- and I think that would be wrong -- then we cannot force the Greeks toward their fortune, Juncker said.
This is not my favored scenario. I would like Greece to stay on board but Greece must fulfill its obligations, he said.
He said euro zone leaders had a responsibility to the whole currency bloc and it was their job to try to stop contagion.
(Reporting By Madeline Chambers; editing by Anna Willard)