Merkel pushes deal to bail Greece out of financial mess

German Chancellor Angela Merkel on Friday praised a deal to bail the troubled Greek economy, saying it would demonstrate that Europe could well cope with the crisis despite moves for an International Monetary Fund bailout package.

"I am very satisfied with yesterday's summit because I think that it demonstrated Europe's capability to handle things and at the same time did something for the stability of the euro and for solidarity with a country that is in difficulty," Merkel said while entering the second day of an EU Council of Ministers summit.

For Europe, she said, it was also important in the long term that the euro, which had been such a success for peace and unity, remained stable. She added that yesterday had been an important date for the euro.

The deal, struck at the meeting of European leaders on Thursday, is aimed at halting the government debt crisis from undermining Europe's currency union. The joint euro zone and IMF bailout programme, that is subject to strict conditions, offers no immediate cash to Greece as of now.
It would be available only if Greece or other troubled states within the EU are not able to raise funds from financial markets. Additionally, it would require the unanimous agreement of the 16 euro zone countries for the release of funds.

The agreement comes as a clear victory for Merkel, who stuck to her position that a rescue for Greece could only be arranged when the country exhausted other options.

It also dealt a blow to the French and the European Central Bank (ECB), position. The ECB was against approaching the IMF because of concerns that it might damage the euro's prestige and show that Europe was unable to solve its own financial woes. The euro zone has never approached the IMF.