PARIS: The leaders of France and Spain met on the eurozone crisis on Wednesday, amid IMF calls for urgent action to control debt which is threatening the global economy. French President Francois Hollande headed into talks with Spanish Prime Minister Mariano Rajoy in Paris ahead of an EU summit on October 18 and 19, with the talks expected to focus on Spain and whether it will seek a rescue. The meeting comes after the eurozone this week launched its much-awaited 500-billion-euro ($643 billion) European Stability Mechanism rescue fund. This safety net is seen as a major bulwark in building the bloc's defences against the debt crisis which has pushed it back into recession. The International Monetary Fund urged the European Union on Wednesday to take more steps to deal with the crisis, which it said is heaping extra pressure on an already-strained global financial system. "(European) policymakers need to take additional measures to restore confidence," said the fund's Global Financial Stability Report, released ahead of the IMF's annual meeting this week in Tokyo. On Tuesday, the IMF added to concerns about the health of the global economy as it warned of a possible recession and cut its growth forecast for this year to 3.3 percent, from July's estimate of 3.5 percent. "Risks to global financial stability have increased and financial markets have been volatile as European policymakers grapple with the ongoing crisis," the report said. Its recommendations included cutting public debt and deficits "in a way that supports growth" and a "clean-up of the banking sector, including recapitalising or restructuring viable banks and resolving non-viable ones". And the IMF was cool towards the latest initiatives by the eurozone. "Unless more action is taken soon, recent improvements in financial markets could prove fleeting," it cautioned. Hollande heads into the talks with Rajoy -- and next week's EU summit -- with his influence strengthened by the French National Assembly's passing on Tuesday of the EU fiscal pact on limiting budget deficits. Despite vocal criticism of the pact from the French left, Hollande's Socialists were able to get the pact approved without needing to rely on the support of right-wing deputies. The upper house Senate is expected to approve it later this week. The talks in Paris come after German Chancellor Angela Merkel's visit to Greece on Tuesday saw tens of thousands of angry protesters take to the streets. The German press on Wednesday was united in its disgust after some of the demonstrators dressed in Nazi uniforms and flew swastikas at the protest. "Germany does not deserve THAT," daily Bild, the country's most-read paper, screamed on its front page, under a picture of protesters in Nazi garb performing the Hitler salute and waving a swastika flag. "Greece, that's enough. You could scarcely think of something more ungrateful... the Greece that showed itself in central Athens yesterday does not belong in the euro," the paper wrote in an editorial. Merkel's visit, her first since the eurozone debt crisis erupted three years ago, was marked by a softer tone as she praised the efforts Greece has already made and encouraged it to continue the "hard road" of reform.

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