European Commission President Jose Manuel Barroso has warned that the sovereign debt crisis is spreading beyond the periphery of the eurozone.
In a letter to European governments, he called on them to give their “full backing” to the euro currency zone.
He also said governments should rapidly re-assess the European Financial Stability Fund (EFSF) to reduce the risk of contagion in the eurozone.
The EFSF was the eurozone’s response to the Greek crisis, agreed on 21 July.
It has not yet been ratified by individual member states.
Mr Barroso said that they needed to, “accelerate the approval procedures for the implementation of these decisions so as to make the EFSF enhancements operational very soon”.
He described the bond markets’ treatment of Italy and Spain as “a cause of deep concern”.
So far, Greece, Portugal and the Irish Republic – known as the eurozone’s periphery countries – have needed bailouts. The European Commission is concerned that it might not be able to afford to rescue Italy and Spain, which have the eurozone’s third and fourth largest economies.
Mr Barroso said that, “Markets remain to be convinced that we are taking the appropriate steps to resolve the crisis.”
“Markets highlight, among other reasons, the global economic uncertainties due to both economic growth and the protracted decision on budgetary adjustments in the US but, first and foremost, the undisciplined communication and the complexity and incompleteness of the 21 July package.”
