Sarkozy threatened to withdraw France from the euro unless Germany vowed to back Greece



Ultimatum: Nicolas Sarkozy reportedly threatened to leave the euro during a meeting with European leaders over Greece

French president Nicolas Sarkozy threatened to pull out of the euro if Germany did not agree to bail out crsisi-hit Greece.

The revelation revived fears over the future of the single currency, sending the euro to an 19-month low against the dollar yesterday.

Mr Sarkozy made his ultimatum at a meeting of EU leaders in Brussels last Friday to discuss the mounting eurozone debt crisis, according to reports in the Spanish press.

He apparently demanded ‘a compromise from everyone to support Greece, otherwise France will have to reconsider its position on the euro’.

A Spanish politician at the meeting, quoted by the respected Spanish daily paper El Pais, said: ‘Sarkozy went so far as to bang his fist on the table and threaten to leave the euro.’

Sarkozy, who is of Greek ancestry on his mother’s side, added: ‘If at a time like this, with everything that is happening, Europe is not capable of a united response, then the euro makes no sense.’

Referring to German chancellor Angela Merkel, the source added: ‘That obliged Angela Merkel to bend and reach an agreement.’

Another source told El Pais: ‘France, Italy and Spain formed a common front against Germany, and Sarkozy threatened Merkel with a break in the traditional Franco-German axis.’

News of the fissures in the EU’s apparently united front against the Greek crisis escalated the turmoil gripping financial markets. Some £44billion was wiped off the value of Britain’s biggest companies after the FTSE 100 fell 171 points or 3.1 per cent to 5,263. The euro fell to a 19-month low of $1.2365.



Investors were also spooked by news that Spain, which is one of the Europe’s most indebted nations, has fallen into deflation.

The surprise drop in consumer prices raised fears that Spain will fall into recession again, which could force Madrid to default on its loans.

The news added to concerns that last weekend’s £95billion rescue package for the eurozone will not be enough to prevent the single currency falling apart.



Before a meeting with Greek prime minister George Papandreou on March 7, Mr Sarkozy said: ‘If we created the euro, we cannot let a country in the eurozone fall. Otherwise there would have been no point in creating the euro.



'We must support Greece because they are making an effort.’

The euro is becoming increasingly unpopular in France, where it is blamed for sky-high prices.

A spokesman for the president said there would be no comment about Mr Sarkozy’s reported outburst.

But the German government flatly denied the reports. Deputy German government spokeswoman Sabine Heimbach said the El Pais report was‘without any basis.’