Australia Urges Greece to Act Swiftly After Vote

Australian Treasurer Wayne Swan Monday urged Greece to quickly form a new government, as he hit out at Europe for failing to adequately tackle financial turmoil.

His comments come after the conservative pro-austerity New Democracy party won a knife-edge election on Sunday and its leader Antonis Samaras urged pro-euro parties to join him in a coalition.

"It is important that Greece's political parties quickly undertake coalition discussions and form a stable government," said Swan.

He added that Australia, which avoided recession during the global financial crisis as most major economies dipped, wanted to see more credible fiscal plans from Europe to prevent contagion.

"I accept that there will be continuing volatility from Europe for some time yet, but I do not accept that the pace and scale of action to address it has been adequate," he told parliament.

Swan said he and Prime Minister Julia Gillard had written to their G20 counterparts "outlining the need for Europe to take decisive action to stabilize their financial system and move towards deeper financial and fiscal union".

Australia wants the world's biggest economies to support growth and jobs in the Eurozone, including through structural reforms, while at the same time urging European economies to put their fiscal positions on a sustainable path.

Swan said while distress in Greece and Spain was drawing attention, in Europe weak financial systems and fiscal positions were sapping confidence and growth as insufficient political accord prevented urgently needed changes.

"For the European project to prevail, what is needed is a pan-European approach that once and for all addresses the crisis," he said.

"Europe needs to outline, and more importantly, deliver credible fiscal plans -- policies that in the short run boost consumption and investment, and in the long run make budgets sustainable."

He highlighted the need for growth, pointing out that Australia persisted with infrastructure investment during the global slump and its resources-led economy was now growing faster than any other major advanced nation.

"The idea that you must choose between growth and fiscal consolidation is false," he said.

"You can have growth then consolidation, so long as your plans are achievable and believable."