(Reuters) - Secretary of State Hillary Clinton on Sunday voiced strong U.S. support for Greece's battle to overcome its debt crisis, saying it was taking the difficult steps required for future growth.
Clinton's visit to Athens was intended to signal Washington's backing for Prime Minister George Papandreou ahead of a meeting of euro zone leaders in Brussels on Thursday to decide on a new bailout package for Greece amid fears the debt crisis could spill over to Spain and Italy.
"Americans know these are difficult days, and again we stand with you as friends and allies," Clinton said at a news conference.
"The United States strongly supports the Papandreou government's determination to make the necessary reforms to put Greece back on a sound financial footing and to make Greece more competitive economically."
While Washington believes European countries should take the lead in managing the Greek debt crisis, it has also been pushing through its membership in the International Monetary Fund (IMF) to support Papandreou's austerity plans, which have led to violent protests at home.
Clinton said Greek's politically painful plan for a medium-term fiscal strategy and bringing down its whopping debt were like "chemotherapy," but would bring results in the end.
"I am not here to in any way downplay the immediate challenges because they are real. But I am here to say that we believe strongly that this will give Greece a very strong economy going forward," Clinton said.
Greek Foreign Minister Stavros Lambrinidis said that despite the popular outrage over the deficit reduction plan, the government was determined to forge ahead.
"We believe that we shall come out of this difficulty victorious," he said. "Many on both sides of the Atlantic have bet on the collapse of Greece and then have been proven wrong. We will continue to prove them wrong."
DIGGING OUT
Greece, which has launched an austerity plan, is hoping for a second European bailout package of about 110 billion euros of extra funds to keep it financed until the end of 2014, when it is supposed to return to financial markets.
Clinton was due to meet Papandreou, President Karolos Papoulias and Finance Minister Evangelos Venizelos before heading to the Acropolis museum in central Athens to sign a cultural agreement designed to prevent trafficking of Greece's rich trove of cultural artifacts.
Despite financial headaches on both sides of the Atlantic, U.S. officials say ties between Washington and Athens are strong and that Greece has been a valuable partner in NATO-led campaigns in both Afghanistan and Libya.
The United States was also grateful to Athens for taking steps to prevent a planned activist flotilla from sailing for Gaza earlier in July, heading off what Washington feared could have been a dangerous confrontation between the pro-Palestinian activists with Israel, which had vowed to block the ships.
U.S. officials said Clinton also discussed several of Greece's diplomatic priorities including remaining strains in its relationship with Turkey and slow reunification talks on the ethnically-split island of Cyprus.
Clinton, who arrived in Greece on Saturday after a visit to Turkey which included a meeting of the international contact group on Libya, is due to depart on Monday for a visit to India that will begin the Asian segment of her round-the-world trip.
(reporting by Andrew Quinn, editing by Peter Millership)
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