Greece must work on issues before help: Nowotny

Nowotny declined to comment directly on what will happen at a meeting of eurozone finance ministers on Monday, where Greece will be the main topic. The ministers are expected to agree a mechanism for aiding Greece but not any specific figures, an EU source said on Saturday.

Nowotny said in principle all eurozone states must work on such problems first before external help is possible.

"Eurozone membership brings considerable benefits for the members. But it also brings responsibilities. When I am a member of the club, then I have to stick to the rules of the club," Nowotny said in an interview.

"That means when individual states, and this would be the case with Greece, get into problems, then the first responsibility to repair them lies with the states themselves."

He said further measures would be "unthinkable" without a clear effort on the part of Greece to sort at its problems.

"(But) when this is the case, then it is possible to apply external help measures," he said, noting that the Greek government and parliament had set out clear steps to tackle the issue. "Politically, this is naturally not easy to implement," he added.

Nowotny said Greece could work with the International Monetary Fund (IMF) for external help, like Hungary did. There could also be an alternative option, Nowotny said, without going into detail.

He noted that some European states were wary of taking IMF help because they felt it would mean accepting a strong U.S. influence. He said it was important for the eurozone to think about its own alternatives.

ECB president Jean-Claude Trichet on Friday welcomed a proposal to create a European Monetary Fund, but said such a fund should be a mechanism to support countries with budget problems.

Speaking more generally about the eurozone, Nowotny said member states should start consolidating their budgets soon.

"The longer member states wait, the more painful the measures which are needed shall be," he said, warning that otherwise there would be a "debt spiral," with public finances getting out of control.

"Worldwide, one can say that we have got through the crisis. One must say that for Europe, the worst of the crisis is over but we are not now in 'year one after the crisis' rather we are still in year three of the overall crisis," he said, adding that the situation remained very fragile.

(Reporting by Sylvia Westall; Editing by Greg Mahlich)