German Government Confident Italy Will Institute Austerity Measures

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ITALIAN AUSTERITY

BERLIN (Erik Kirschbaum, Eric Kelsey and Sarah Marsh) - Germany's government has full confidence in Italy to take the necessary decisions regarding austerity measures and sees no need to expand the euro zone bailout mechanism, a government spokesman said on Monday.

"The German government has full confidence in the Italian government that it will take the clearly necessary decisions for an austerity budget," said Chancellor Angela Merkel's spokesman Steffen Seibert.

Seibert also told reporters at a government news conference that Germany agreed with other euro zone leaders that a second bailout package for Greece must be agreed quickly and would top the agenda of Monday's euro zone talks in Brussels. "Germany has never said 'This all has time until the autumn,' but rather said there's a need for a quick, joint solution that nevertheless has to include the fulfillment of certain criteria," Seibert said.

But Seibert said Italy, the latest focus of worries about possible contagion of the euro zone debt crisis, was not on the agenda of a special meeting of the European Union's top finance officials ahead of talks between euro zone finance ministers.

"According to our information, Italy is not on the agenda of this meeting," Seibert said. The issue on the agenda is a new program for Greece, he added.

(Writing by Stephen Brown)

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