Prime Minister Stephen Harper has expressed confidence that Europe is on the right track, but says the situation needs to be resolved because global economic growth depends on it.
"I think what the Europeans have put together is certainly on the right track. There's a lot of work to be done and finish it and put it in place, and that's what they need to be concentrating on. And I think we're coming out of the G20 with them concentrating on doing that, and I think everybody knows the stakes are very high," the prime minister said in an interview with host Tom Clark on the new Global News political show, The West Block.
One of the accomplishments of last week's G20 meeting was to convince Greece's Prime Minister, George Papandreou, to abandon his plan to hold a national referendum before agreeing to terms of the trillion-euro debt-reduction plan and bailout package.
"You know, the last week's been quite eventful. We had what looked like a European plan. A week ago, October 27, they came out with a deal that certainly had the key elements necessary. And then to everybody's surprise the Greeks said, 'We're not really sure we're abiding by it. We're going to put it to a referendum instead.' Now it appears that's off, and we're back to implementing the plan," Mr. Harper said.
He also said the Italians are confident they can deal with their debt situation and put their financial house in order.
"There's been market uncertainty about that; we're seeing the spreads on Italian bonds start to rise. So the Italians specifically have asked the IMF to come in and provide, you know, monitor, provide surveillance, provide the confidence to the international markets that they are, in fact, on the right track, So I think that's a positive development," he said.
"But you know, look. Obviously, this problem has to be fixed. I don't think it's any secret. We've kind of been watching this in slow motion for a couple of years, and while I know it's complicated, I think everybody has been clear to the Europeans that this is really starting to affect global confidence and global growth and it simply must be resolved."
Europe may already be in a mild recession, the prime minister said. But he doesn't expect it will become a global one.
"The expert money is still not on a recession, and I have no reason to predict that either."
The U.S. is not in a recession, he said, but the uncertainty over the situation in Europe has affected job creation in growth in all the G20 countries.
"But most of them are still continuing to grow. Albeit at reduced rates. So that continues to be our expectation, and our plan has been based on the assumption we will grow, but we will grow slowly."
The prime minister got more personal towards the end of the interview, when Mr. Clark noted that he had achieved the ambition of a lifetime with a majority government.
"Obviously I'm pretty proud of the achievement. I would say, probably my even bigger ambition of a lifetime is the ambition that most families have, and that's to see my children grow up and be happy, and be productive citizens. And that's probably the thing that's my biggest ambition of a lifetime, but it's one we share with so many other families out there," he said.