German Chancellor Angela Merkel has said kicking out a member of the euro should be an option.

In what is being seen as a reference to Greece, she told parliament that the move would only be a last resort, but short-term bailouts for the EU’s struggling economies were not the answer.

She said: “Wolfgang Schaeuble (Germany’s finance minister) made proposals so that the IMF (International Monetary Fund) would not have to be called in. In the future, she said, we need a clause in the treaty that would make it possible, as a last-resort, to exclude a country from the euro zone if the conditions are not fulfilled again and again over the long term. Otherwise cooperation is impossible.”

The Eurozone’s finance chiefs say safeguards are in place should Greece default. But both Germany and France remain deeply reluctant to bail-out their deficit stricken EU partner.

Yesterday, Athens saw further demonstrations outside parliament against the Greek government’s austerity measures.

Although that passed off relatively peacefully, some scuffles did break out with a small group of protesters.

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