Hollande and Monti agree importance of budget discipline to confront Europe's debt crisis

The Italian and French leaders on Thursday found common ground on how to confront Europe's worsening debt crisis, emphasizing that budget discipline should not come at the expense of economic growth and calling for a region-wide move to boost market confidence.      

The leaders held their first bilateral meeting since President Francois Hollande took office last month as Italy's borrowing costs skyrocketed on concerns the country may be the next, after Spain, to need financial aid.       

Speaking at a joint news conference with Italian Prime Minister Mario Monti after talks, Hollande sought to defend Europe saying, "I don't want a Europe seen as a sick continent."       

"We have economic power, we are a group of countries with a great history. With all the conditions to assure our future. But we ourselves must make efforts," Hollande told reporters gathered at Palazzo Chigi, the Italian Premier's office in Rome.      

Referring to the crisis in Syria, Hollande said sanctions against the country needed to be reinforced, but that it was also crucial to find a political solution together with Russia.      

Monti's attention remained firmly on Greece however, where national elections are going to be held in three days time.    

"We have talked about this also and I want to reaffirm my wish that Greece remains in Europe and respects its obligations." he said.       

Greece's creditors - its European partners and the International Monetary Fund - have warned that the cash lifeline would dry up if a new government played tough and tried to unilaterally abandon previous pledges for further cutbacks and reforms.       

Without the money, Greece would go bankrupt and likely have to leave the 17-country eurozone. The need for action to boost market confidence in the euro was evident in the bond market movements on Thursday.

APTN