Leaders meeting for crisis talks before G20 summit

Greek Prime Minister George Papandreou is to hold emergency talks with French President Nicolas Sarkozy and German Chancellor Angela Merkel later, ahead of the G20 summit starting on Thursday. It comes after Mr Papandreou made the surprise announcement that Greece would hold a referendum on the eurozone rescue plan agreed last week. Markets fell sharply on Tuesday on fears that the deal could collapse. The eurozone crisis is also set to dominate the two-day G20 gathering. Important decisions' Mr Sarkozy said the talks with Mr Papandreou would include discussions on "the conditions under which the engagements undertaken will be kept". The meeting is taking place in Cannes ahead of the G20 summit in the same French city on Thursday and Friday. Also due to join the Greek, German and French leaders on Wednesday evening are European Council President Herman Van Rompuy, European Commission President Jose Manuel Barroso, Eurogroup President Jean-Claude Juncker, and International Monetary Fund Managing Director Christine Lagarde. It was unclear if Mr Papandreou will still be joined at the meeting by his finance minister Evangelos Venizelos, who was discharged from hospital earlier after complaining of stomach pains on Tuesday. World leaders, including US president Barack Obama, have indicated in recent weeks that they wanted eurozone leaders to lay out at the G20 a clear plan to resolve the bloc's debt crisis. But a key part of the plan - another bailout of Greece and further austerity measures - is at risk now that Athens has decided to put the matter to a popular vote. Speaking before he travels to France, Indian Prime Minister Manmohan Singh said "much more needs to be done" to restore investor confidence in the eurozone. That sentiment was echoed by Mr Obama's spokesman, Jay Carney. He said: "[The Europeans] need to implement the very important decisions they made last week to provide a conclusive resolution to it." Last week, eurozone leaders agreed a 50% debt write-off for Greece as well as strengthening the eurozone bailout fund, the European Financial Stability Facility (EFSF), to 1trn euros ($1.4tn; £860bn). However, the package is reliant upon Greece continuing to carry out extensive and unpopular austerity measures. Most commentators say this will be rejected by the Greek people in any referendum, which may not be held for many weeks. Eurozone leaders have been courting China, India and other emerging market nations to invest in the EFSF. But China, with its $3.2tn in foreign exchange reserves, is seen as the only developing economy with sufficient resources to make a sizeable contribution.