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EU Leaders Warn of Crippling Crisis

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German Chancellor Angela Merkel (L), President of France Nicolas Sarkozy (C) and European Commission President Jose Manuel Barroso

Eurozone leaders have used their New Year’s messages to warn of more economic crisis for the year ahead, as many eurozone countries expect recession in 2012.

German Chancellor Angela Merkel said on Sunday she expects more difficulty in 2012, but she does “everything” to save the euro and end Europe´s sovereign debt crisis.

“The debt crisis is still keeping us in suspense,” Merkel added in her New Year’s message.

French President, Nicolas Sarkozy, who is lagging behind in the polls just months from a presidential election, said 2012 was a year “full of risks” and vowed that no further public spending cuts would be made.

“I know that the lives of many of you, already tested by two difficult years, have been put to the test once more. You are ending the year more worried about yourselves and your children,” Sarkozy said.

Italy’s president, Giorgio Napolitano was less eager to gloss over the economic failure of his country, which last year was feared to be on the brink of becoming the next eurozone country to seek a bailout.

“No one, no social group, can today avoid the commitment to contribute to the cleanup of public finances in order to prevent the financial collapse of Italy,” Napolitano added.

Meanwhile, the Greek Prime Minister, Lucas Papademos, spelled out a continuation of harsh austerity measures

“A very difficult year, marked by necessary but painful measures, is ending… a very difficult year is around the corner,” Lucas Papademos said in his New Year’s message.

The leaders’ New Year messages came as growth stalls in countries across Europe and fears are growing that 2012 could bring a second recession.

Some of the eurozone’s largest economies, including Italy and Spain borrowing rates have increased dramatically in recent months, putting them under pressure to make further budget cuts to reassure investors.


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