The crisis over Greece's debt mountain is unlikely to spread to other eurozone countries with high levels of public debt, International Monetary Fund (IMF) Managing Director Dominique Strauss-Kahn said yesterday.
In an interview, Strauss-Kahn dismissed market speculation of potential default by other heavily indebted eurozone countries such as Portugal, Spain or Ireland as scare-mongering.
"You can add to the list all of the countries in the Eurozone, to try to scare people about everything. I don't think it will happen," he said.
"We have a problem with Greece. We don't have a problem with Spain to date. The eurozone has to deal with the Greek problem. They are doing this. No one knows what's going to happen tomorrow morning but there's no reason why the spillover to Portugal or to Spain will take place."
Separately, Strauss-Kahn, who is on a tour of Kenya, South Africa and Zambia to see how the poorest continent has bounced back from last year's global economic crisis, said he was confident eurozone countries could handle the Greek debt maelstrom.
Greek Prime Minister George Papandreou said last week he might have to go to the IMF to meet debt obligations falling due in April if the European Union did not help with funds. It would be the first bailout in the history of the euro.
However, Strauss-Kahn said he did not think IMF involvement would be needed beyond the current levels of technical assistance offered and accepted by Athens.
"The eurozone wants to deal with the problem itself and I can understand this," he said. "I think they can do it. I hope they will be able to do it, and we're just here to help."
"If some more is needed, we will be ready to do it, but so far I think that the Europeans will be able to deal with the problem."
French President Nicolas Sarkozy says the eurozone's biggest powers will back Greece through the debt crisis that has jeopardised all 16 nations in the common currency. The French leader issued a warning to traders who would bet against the eurozone's willingness to defend a member state.
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