According to a report in Spain’s El Pais newspaper, French president Nicolas Sarkozy is seriously considering reinstating the franc after threatening to pull his country out of the Euro at a meeting of European leaders deciding Greece’s aid package last Friday.
The newspaper cited comments by Spanish Prime Minister Jose Luis Rodriguez Zapatero who revealed details of Sarkozy’s threat at a closed-doors meeting of leaders from his Spanish socialist party on Wednesday.
Sarkozy, reportedly banged his fist on the table and demanded a “commitment from everyone to support Greece…or France would reconsider its position in the euro…That obliged Angela Merkel to bend and reach an agreement,” according to one El Pais source.
Another source present at the meeting between Zapatero and his party told El Pais that “France, Italy and Spain formed a common front against German and Sarkozy threatened Merkel with a break in the traditional Franco-German axis.”
El Pais also quotes Sarkozy as having said that “if at time like this, with all that is happening, Europe is not capable of a united response, then the euro makes no sense”.
Last week the European Union and IMF agreed to a 110 billion-euro rescue package for Greece to prevent a default. But Germany, which will provide nearly 30% of the euro region’s overall contribution, had proven reluctant to commit itself to a plan.