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Strauss-Kahn arrest casts shadow over eurozone meeting Strauss-Kahn arrest casts shadow over eurozone meeting
(40 minutes later)
The arrest of IMF boss Dominique Strauss-Kahn in New York, on charges of the sexual assault of a hotel maid, is overshadowing a meeting of eurozone financial leaders.The arrest of IMF boss Dominique Strauss-Kahn in New York, on charges of the sexual assault of a hotel maid, is overshadowing a meeting of eurozone financial leaders.
He had been due to attend a meeting in Brussels to discuss additional help for Greece's debt-hit economy.He had been due to attend a meeting in Brussels to discuss additional help for Greece's debt-hit economy.
Issues up for discussion include what conditions to apply to any more financial bail-outs for the country.Issues up for discussion include what conditions to apply to any more financial bail-outs for the country.
A 78bn euro (£68bn; $110bn) bail-out for Portugal may also be approved.A 78bn euro (£68bn; $110bn) bail-out for Portugal may also be approved.
And the meeting will also check the latest progress of the Irish Republic in dealing with its debt crisis.And the meeting will also check the latest progress of the Irish Republic in dealing with its debt crisis.
'Significant role''Significant role'
Analysts were worried about the absence Mr Strauss-Kahn's absence from the meeting.Analysts were worried about the absence Mr Strauss-Kahn's absence from the meeting.
"The leadership vacuum at the IMF comes at a highly inopportune time for Europe, which is teetering on the brink of a full-blown debt crisis," said Eswar Prasad, a professor of international economics at Cornell University and a former IMF official."The leadership vacuum at the IMF comes at a highly inopportune time for Europe, which is teetering on the brink of a full-blown debt crisis," said Eswar Prasad, a professor of international economics at Cornell University and a former IMF official.
Lucinda Creighton, the Irish Republic minister for Europe, told broadcaster RTE that Mr Strauss-Kahn was "somebody who has had a significant role in the events of recent months in relation to the Irish bail-out".Lucinda Creighton, the Irish Republic minister for Europe, told broadcaster RTE that Mr Strauss-Kahn was "somebody who has had a significant role in the events of recent months in relation to the Irish bail-out".
However, she added: "But it is not unusual for the head of the IMF to be absent from a meeting like this and I don't think it'll really have any impact."However, she added: "But it is not unusual for the head of the IMF to be absent from a meeting like this and I don't think it'll really have any impact."
Default fearsDefault fears
The eurozone meeting is expected to discuss the situation in Greece, and whether the country will need additional help to deal with its debts.The eurozone meeting is expected to discuss the situation in Greece, and whether the country will need additional help to deal with its debts.
Some European leaders are unhappy at what they perceive as limited Greek efforts to raise money by selling government property.
At a sensitive moment for the eurozone crisis, Dominique Strauss-Kahn will be badly missed.At a sensitive moment for the eurozone crisis, Dominique Strauss-Kahn will be badly missed.
He was intimately involved in the detail of the bail-outs for Greece, the Republic of Ireland and Portugal.He was intimately involved in the detail of the bail-outs for Greece, the Republic of Ireland and Portugal.
He personally handled many of the negotiations and micro-managed some of the terms and conditions.He personally handled many of the negotiations and micro-managed some of the terms and conditions.
As a former French finance minister, he personally knew most of the key leaders and officials managing the crisis.As a former French finance minister, he personally knew most of the key leaders and officials managing the crisis.
He passionately believed in the survival of the euro and, under him, the IMF was fully committed to finding a way out of Europe's debt crisis.He passionately believed in the survival of the euro and, under him, the IMF was fully committed to finding a way out of Europe's debt crisis.
Although his deputy John Lipsky was the case officer for the bail-outs, he is unlikely to be such an influential figure.Although his deputy John Lipsky was the case officer for the bail-outs, he is unlikely to be such an influential figure.
If and when Mr Strauss-Kahn is replaced, the leadership of the IMF may well not go to a European, and officials in Brussels are already anxious about this.If and when Mr Strauss-Kahn is replaced, the leadership of the IMF may well not go to a European, and officials in Brussels are already anxious about this.
Some European leaders are unhappy at what they perceive as limited Greek efforts to raise money by selling government property.
Debt-strapped Greece was bailed out a year ago by the EU and IMF to the tune of 110bn euros ($157bn; £93bn) euros.Debt-strapped Greece was bailed out a year ago by the EU and IMF to the tune of 110bn euros ($157bn; £93bn) euros.
Since then it has imposed a series of financial cuts and austerity measures to try to balance its books.Since then it has imposed a series of financial cuts and austerity measures to try to balance its books.
On Friday, EU Economic and Monetary Affairs Commissioner Olli Rehn said Greece must take additional steps to consolidate public finances because it was missing its deficit reduction targets.On Friday, EU Economic and Monetary Affairs Commissioner Olli Rehn said Greece must take additional steps to consolidate public finances because it was missing its deficit reduction targets.
The country has a 327bn euros debt pile, or nearly 150% of its economic output.The country has a 327bn euros debt pile, or nearly 150% of its economic output.
Germany provided a large chunk of the Greek bail-out cash and wants to see stringent conditions applied before backing any new aid.Germany provided a large chunk of the Greek bail-out cash and wants to see stringent conditions applied before backing any new aid.
European Central Bank governing council member Ewald Nowotny told German business daily Handelsblatt that Greece may be entitled to receive further loans.European Central Bank governing council member Ewald Nowotny told German business daily Handelsblatt that Greece may be entitled to receive further loans.
"But you have to grant them under very strict conditions," he added."But you have to grant them under very strict conditions," he added.
Many analysts believe that Greece's financial troubles are so deep that a Greek default on its debts appears inevitable.Many analysts believe that Greece's financial troubles are so deep that a Greek default on its debts appears inevitable.
"The policy response [to the debt crisis] continues to be ad hoc, behind the curve," RBS chief European economist Jacques Cailloux said."The policy response [to the debt crisis] continues to be ad hoc, behind the curve," RBS chief European economist Jacques Cailloux said.
However, the European Central Bank appears determined to prevent any default as such a move could undermine the euro.However, the European Central Bank appears determined to prevent any default as such a move could undermine the euro.
The euro fell to a seven-week low against the dollar and a two-month low against the yen before the meeting.The euro fell to a seven-week low against the dollar and a two-month low against the yen before the meeting.