Restructuring Greek debt risks devastation: Commission

(STRASBOURG) - The European Union economic affairs chief warned Wednesday that restructuring Greece's massive debt would have devastating consequences for the country and the eurozone as a whole.

Amid growing fears the EU may have to rescue Greece for a second time, European economy commissioner Olli Rehn said a "large part" of the Greek banking system would likely "become insolvent" if the national debt was restructured.

It would also have dire consequences for growth and employment, and shut Greece out of the international borrowing markets for a long time, he said.

Those calling for a restructuring of the debt "seem to ignore the potentially devastating implications to finance and stability in the country itself and the euro area as a whole," Rehn told the European Parliament.

Rehn said Tuesday that a decision on whether Greece needs a second financial bailout would be made in "a few weeks".

He also stressed that it was "premature" to discuss further steps before EU, IMF and European Central Bank auditors wrap up a review of Greek finances.

Speculation has mounted in recent days that an additional 60 billion euros will be needed over the next two years to help Greece overcome a mountain of debt. Analyst have also said a restructuring of 340 billion euros in public debts would be needed.

European finance ministers meet Monday and Tuesday in Brussels, with Greece high on the agenda along with two other struggling eurozone nations, Ireland and Portugal.