No eurozone answers as crisis drifts on

By Alex Stevenson

David Cameron has called for "decisive action soon" to resolve the ongoing eurozone crisis.

The prime minister's comments came after an informal summit of EU leaders over dinner failed to reach concrete conclusions on how to address concerns about Greece's future and high borrowing rates for other struggling eurozone countries.

"It was a good meeting in that there was complete agreement that dealing with deficits and getting growth are not alternatives, they go together," Mr Cameron said.

"There were good innovative ideas that can help growth in Europe but there were some bad ideas too."

Top of Mr Cameron's 'bad idea' list is the financial transactions tax which led him to veto the EU's fiscal integration proposals last December.

"It would put up the costs of people's insurance, it would put up the cost of people's pensions, it would cost many, many jobs, it would make Britain less competitive and I'll fight it all the way," Mr Cameron added.

Last night's meeting effectively offered the Greek people an ultimatum, maintaining their bailout funds only if it maintains already agreed brutal spending cuts.

"All of us emphasise that consolidation of finances - austerity on the one hand and growth on the other - are not opposites," German chancellor Angela Merkel said.

"They are two sides of the same coin."

Also of concern to eurozone countries is the prospect of other countries seeking bailout money. High borrowing costs could force Spain and Italy to seek cash to help them as Greece, Ireland and Portugal already have.

The recent Franco-German 'duopoly' appears to be collapsing following the election earlier this month of French president Francois Hollande, who was attending his first European leaders' meeting.

Mr Hollande secured a majority of support for his plan to introduce eurobonds, which would share the continent's debts more broadly.

"I see things differently. Eurobonds would be a way for eurozone countries to share their debts," he explained.

"Eurobonds could also be used for investment projects that would be guaranteed directly by the Union."

Germany rejected the proposal, however, along with a number of other countries.

British deputy prime minister Nick Clegg is visiting Berlin alongside business secretary Vince Cable today, where they will meet a number of German ministers.

Mr Clegg will criticise European leaders for having offered a "woefully fragmented" response to the crisis.

"Every few weeks European leaders sit down to yet another crisis summit, where another temporary solution is agreed," he will say.

"The tree is falling, and we are pruning one leaf at a time. It is piecemeal politics; endless tactics with no strategy."

He is expected to say the decisions taken so far have undermined public confidence, created "different classes" of countries and wrongly tried to keep questions of labour market reform, fiscal discipline and management of financial risk separate.

"The sceptics will claim Europe is now congenitally incapable of exercising the leadership needed to do so," Mr Clegg will say at an event launching the Queen Elizabeth prize for engineering.

"I absolutely reject that. We have got to hit back against this fatalism which says that Europe can't fix this."

Greece goes to the polls on June 17th, after which its future - and that of the continent - will become clearer.