Italy's Letta rebukes Europe for 'serious mistakes' in Greek bailout

ATHENS Mon Jul 29, 2013 8:28am EDT

Italy's Prime Minister Enrico Letta (L) addresses reporters during a joint news conference with his Greek counterpart Antonis Samaras in Athens July 29, 2013. REUTERS/Yorgos Karahalis

Italy's Prime Minister Enrico Letta (L) addresses reporters during a joint news conference with his Greek counterpart Antonis Samaras in Athens July 29, 2013.

Credit: Reuters/Yorgos Karahalis

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ATHENS (Reuters) - Italian Prime Minister Enrico Letta rebuked Europe for its handling of the Greek crisis on Monday, saying the harsh austerity imposed on Athens had deepened the recession and worsened unemployment across the continent.

"There is no doubt that serious mistakes were made about Greece by Europe in the past few years," Letta said during a visit to Greece, now in its sixth straight year of recession.

"The timing was wrong. The instruments were wrong. The interventions were not made in the right way and at the right time and this worsened the crisis," he said, in one of the strongest official criticisms of the bailout terms set by the European Union, European Central Bank and International Monetary Fund.

"The crisis would have been different. It would have created less of a financial disaster, it would have led to fewer job losses across Europe if Europe's attitude to Greece had been different at the beginning," he said at a joint news conference with his Greek counterpart Antonis Samaras.

Greece has been at the centre of the euro zone debt crisis since seeking its first rescue package in 2010. Repeated rounds of tax hikes and spending cuts have thrown thousands out of work and fuelled violent demonstrations against the measures demanded as the price for staving off default on its huge public debt.

Italy, with a public debt burden second only to Greece's in the euro zone as a proportion of its overall economy, has also suffered severely as successive governments have struggled to get its battered public finances in order.

Letta, who has repeatedly urged Europe to emphasize growth and jobs rather than pure budget rigor, said it had to be clear to people in the debt-ridden countries of southern Europe that the sacrifices demanded of them would improve their lives.

"These sacrifices are not an end in themselves, they're not the goal, they're the instrument to reach the promised land," he said.

Letta also repeated that Europe risked feeding growing anti-EU sentiment that would become clear in next year's European parliamentary elections.

(Reporting by Deepa Babington, Writing By James Mackenzie; Editing by Hugh Lawson)

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