Obama: Euro Debt Deal Is 'Progress'

　　President Barack Obama says there is no doubt that the European Union’s agreement to slash 1 Greece’s debt and enlarge a bailout fund is progress. The president says strong execution of the plan is essential.

　　After meeting Thursday with the Czech Republic’s prime minister, Petr Necas, President Obama said the EU debt accord is a step toward resolving the euro zone’s debt crisis.

　　“I was very pleased to see that the leaders of Europe recognize that it is both in Europe's interest and the world's interest that the situation is stabilized 2.  And I think they have made significant progress over the last week and the key now is just to make sure that it drives forward in an effective way,” Mr. Obama said.

　　Share prices soared on world markets after the agreement was announced.  In New York, the Dow Jones Industrial Average gained almost three percent, largely in reaction to the news.

　　Obama said the health of Europe’s economy directly affects the health of America’s economy.

　　“If Europe is weak, if Europe is not growing, as our largest trading partner, that is going to have an impact on our businesses and our ability to create jobs here in the United States,” Mr. Obama said.

　　EU leaders persuaded banks and investors 3 to accept a 50 percent loss on Greek government bonds, which would cut Greece’s debt in half.  Under the plan, banks would need to raise another $148 billion by June.  And the 17 countries in the euro zone will boost their bailout fund to $1.4 trillion.

　　President Obama thanked Prime Minister Necas for the Czech Republic’s contribution to the NATO-led military coalition 4 fighting in Afghanistan.

　　Both leaders said their nations remain committed to promoting democracy and human rights.

　　European leaders said the debt-relief agreement could help resolve the continent's two-year-long crisis and give Greece a chance to regain 5 its economic footing. German Chancellor 6 Angela Merkel said "we have done what needed doing." French President Nicolas Sarkozy said it was a "credible 7 and ambitious" plan, while Greek Prime Minister George Papandreou said the result would be "a new era, a new chapter" for his country.

　　U.S. President Barack Obama welcomed the deal as a "critical foundation" to help solve the eurozone crisis and said the United States will support its European allies to address global economic problems.

　　What's included

　　Following 10 hours of tense negotiations 8 in Brussels, EU leaders said they had convinced banks and investors to accept a 50 percent loss on Greek government bonds, effectively reducing Greek debt by $140 billion. At the same time, the banks are required to raise an additional $148 billion by June. The 17-nation bloc 9 that uses the euro currency is increasing the firepower of its bailout fund to $1.4 trillion to cover future assistance for debt-ridden nations.

　　The deal still leaves Greece with a significant debt burden - estimated at 120 percent of its economic output in 2020, down from 160 percent now. But Greek Finance Minister Evangelos Venizelos said that debt level "becomes viable 10" for the country.