Sigh of relief at G20 summit over Greek election

Mexican soldiers patrol the beach of San Jose del Cabo in Mexico's Baja Peninsula, Sunday, June 17, 2012. The G-20 summit starts in Los Cabos on Monday. (AP Photo/Eduardo Verdugo)

Mexican soldiers patrol the beach of San Jose del Cabo in Mexico's Baja Peninsula, Sunday, June 17, 2012. The G-20 summit starts in Los Cabos on Monday. (AP Photo/Eduardo Verdugo)

Tourists enjoy the beach of San Jose del Cabo in Mexico's Baja California Peninsula as a Mexican Navy boat patrol on Sunday, June 17, 2012. The G-20 summit starts in Los Cabos on Monday. (AP Photo/Eduardo Verdugo)

A Mexican federal police helicopter flies as a Mexican navy ships patrols the bay waters in San Jose del Cabo in Mexico's Baja Peninsula, Friday, June 15, 2012. Security has been beefed up in preparation for the upcoming G-20 summit that will be held in Los Cabos June 18-19. (AP Photo/Fernando Castillo)

Mexican soldiers patrol the beach of San Jose del Cabo in Mexico's Baja Peninsula, Sunday, June 17, 2012. The G-20 summit starts in Los Cabos on Monday. (AP Photo/Eduardo Verdugo)

LOS CABOS, Mexico (AP) ? World leaders expressed relief on the eve of a G20 summit that Greek voters had stepped back from the edge and elected a government that supports painful reforms in exchange for a European Union bailout of the country's troubled economy.

Fears that Greek voters would instead choose an anti-bailout government and possibly force the country's exit from the currency union had haunted the gathering in this sunbaked Mexican resort, where the crisis facing Greece, Spain, Italy and other European economies have taken center stage.

Instead, world leaders said they saw Sunday's vote as a boost for European unity even in the face of economic turbulence.

"The Greek people have spoken," European Council President Herman Van Rompuy and European Commission President Jose Manuel Barroso said in a joint statement. "We salute the courage and resilience of the Greek citizens, fully aware of the sacrifices which are demanded from them to redress the Greek economy and build new, sustainable growth for the country."

As the pair indicated, the path ahead for Greece, and by extension the bigger economies of Italy and Spain, remains unclear and market turmoil could erupt again at virtually any time. A Greek exit from the currency union had threatened potentially catastrophic consequences for other ailing European nations and the global economy.

Spanish Prime Minister Mariano Rajoy lauded the Greek vote while speaking to reporters in Mexico, saying "we have improved a lot since we've entered the euro."

"What's happened in Greece is good news," Rajoy said. "The Greek citizens have done the right thing. The European Union is going to help Greece, because the European Union is and must be a joint project that seeks the well-being and the material improvement of all European citizens."

Chinese Vice Finance Minister Zhu Guangyao stressed the importance of stability in the wake of the Greek vote.

"We hope this new government will be on a solid footing and can maintain stability since stability is important to promoting development," Zhu said. "We believe that Greece should stay within the euro zone."

U.S. President Barack Obama, set to arrive Sunday night, and the summit's host, Mexican President Felipe Calderon, have been downplaying expectations for the summit.

Obama is seeking bolder, swifter signals from Europe that it will contain its financial mess and keep it from torpedoing the U.S. economy and his re-election chances along with it.

Calderon has given a more optimistic message, including that he expects the G20 to produce record donations to the International Monetary Fund, exceeding member states' pledges of $430 billion this year and bolstering its ability to conduct more bailouts in Europe.

There were, however, clear signs of deep divisions over this relatively straightforward measure. Calderon said the U.S. would decline to contribute, a decision in line with Washington's position that more IMF money would be a de-facto U.S. bailout of Europe. It was unclear how much money would come from emerging economies such as Brazil and India, which have been pushing for more say in the governance of the IMF in exchange for greater contribution.

Still due to arrive Sunday night were major players in the European crisis such as German Chancellor Angela Merkel and French President Francois Hollande.

The twin resort towns of Cabo San Lucas and San Jose del Cabo are ideal spots for Calderon's last moment in the international spotlight before July 1 presidential elections widely predicted to bring back the party that ruled Mexico with near-virtual control for seven decades before it was ousted from the country's highest office in 2000.

Recent months have been as bad as any for Mexico's battered international image, with scores of bodies dumped across the country by rival cartels, five journalists killed in the eastern state of Veracruz and a travel warning for Americans in a state on the Texas border to beware retaliation for a recent U.S. operation against the Zetas cartel.

"It's an issue that unfortunately puts Mexico on the world stage for the wrong reasons," Calderon told reporters Saturday.

But he also touted his record, saying Mexico had made fundamental changes for the better on questions of security, part of a legacy that also included improved health care coverage, infrastructure and the hosting of a series of international events including a climate summit, a visit by the pope, and the G20.

Violence in Mexico had been dropping steadily when he took office in 2006 then spiked during his stepped up offensive on Mexico's drug cartels. Since then more than 47,000 people have died in drug-related violence.

Associated Press writer E. Eduardo Castillo contributed to this report.

Associated Press

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