Geithner has confidence in eurozone

Despite the worsening eurozone crisis, US Treasury Secretary Timothy Geithner Wednesday said that he still believes that his European Union counterparts have the will and capacity to keep the single currency system together.

Europe is in the next stage of another major escalation (of current crisis) and the EU leaders are planning some important decisive policy changes in near term, Geithner told the audience at the Council on Foreign Relations in Washington ahead of the annual meeting of the Group of 20 (G20) in Mexico next week.

The organization of the major developed and developing countries, which is set up to serve as the steering committee for the world economy, is expected to focus on economic growth and euro-zone crisis as the leaders meet at the Mexican resort of Los Cabos on June 18-19.

The EU leaders have outlined a set of tools to overcome the crisis by forming a banking union, boosting crisis resources and promoting economic growth, the US official said.

"They have recognized that they have to do much more to restore the economy and in Mexico we can hear from them what they are going to do next."

With a bailout package, Greece may still default or leave the euro zone after the national election on Sunday. Though Spain's banks receiving a $125 billion bailout last weekend, its borrowing costs continued to surge and hit the highest level Tuesday since the country adopted the euro. Italy's borrowing costs also rose to the highest point of the year.

Geithner said his European counterparts do not lack of political will or capacity to deal with the crisis, but they should act quickly to prevent another round of escalation.

"They've decided that it's in their interest to hold this together," he said. "They tell us privately that they will do whatever is necessary to hold it together."

Commenting on the US role in fighting the eurozone crisis, the secretary said Washington has played an important role helping stabilizing the eurozone economy and tried to be as helpful and persuasive as possible

As the world's largest economy, the US has a long-term interest in euro zone and supports the single currency innovation, the secretary said.

"We have interest helping and making it work but we can't choose for them how to do that," he said.

"They are a very rich continent and it's within their capacity to manage it."

China shares the similar view as Beijing expressed its support for Greece staying in the eurozone and urged Europe to address the issues of debt more decisively.

The G20 summit should recognize the efforts of the leaders of the EU and Eurozone countries for their determination, capability and resources to resolve the sovereign debt crisis, Chinese Foreign Ministry spokesman Liu Weimin said Wednesday.

China believed that Europe had the capability to overcome the crisis, and is ready to strengthen cooperation with Europe and the IMF under the framework of the G20, China's Vice-Minister of Finance Zhu Guangyao said earlier.

tanyingzi@chinadailyusa.com