EU leaders set Greece on its pace

European Union leaders have agreed on a new initiative to help Greece achieve economic growth, but continue to insist the country carry out austerity measures.EU leaders met for six hours in an extraordinary summit held in Brussels, Belgium, on Wednesday.

Greece has been in recession for five years, crippled by a debt mountain, high unemployment and labour unrest.There are fears that a Greek exit could trigger a run on the banks  not only there but in other eurozone countries.
EU confirmed they want Greece to stay in the eurozone but called on it to carry out austerity and respect its commitments for receiving an EU bailout.Leaders agreed for the first time on measures to help Greece achieve economic growth and job creation.They agreed to use EU subsidies designed to narrow inequalities among members.

EU summit comes as Greece prepares to hold fresh elections June 17th after attempts to form a coalition failed.After the summit, European Council President Herman Van Rompuy said continuing vital reforms is the best guarantee for a more prosperous future in the euro area. He said EU leaders expect the next Greek government to make that choice.

He also said the EU needs both financial stability and growth, and should not see the situation as a choice between the two.The meeting discussed growth strategies for the region amid the reality that austerity is hurting the economies of heavily indebted countries.They agreed on measures such as boosting the lending capacity of the European Investment Bank.

German Chancellor Angela Merkel says she and new French President Francois Hollande failed to narrow differences on the issue of euro-bonds during the European Union summit. The leaders debated the idea to launch euro bonds as a way to ease the debt crisis.

After the summit, Merkel said eurobonds, which allow troubled nations to borrow funds at lower rates than their fiscal conditions require, would not foster growth in the euro-zone.

Merkel said she expressed the view at the summit and some European nations shared the opinion.

French President Hollande told reporters eurobonds would be a tool for long-term EU integration and that he hopes to make progress at a summit late next month.