European Commission President Jose Manuel Barroso told the European Parliament in Strasbourg on Tuesday that his commission will find solutions for Greece’s financial problem.

He says the mechanism will be in line with the Lisbon Treaty, as opposed to the proposed European Monetary Fund (EMF) put forward by Germany's finance minister.

Barroso also says Greece is taking the necessary steps to reduce its budget deficit this year. Responding to criticism from members of parliament, he says the European Union is working on curtailing market speculation through reform.

The current problems in Greece are not believed to be caused by speculation, but mainly overspending.

The Commission will consider banning naked contract selling, which investors use to hedge against countries defaulting on their debt. The European Union’s executive would like the G20 group of nations to discuss speculation in credit default swaps—a form of insurance against default.

Naked selling involves selling a swap to a buyer who does not hold the underlying sovereign bond.

On Monday, Greek Prime Minister George Papandreou urged the G20 to crack down on market speculators.

The Commission will be examining closely the relevance of banning purely speculative, naked sales on credit default swaps of sovereign debt. It would also push for international coordination on the issue.

The debate is growing on whether or not a European Monetary Fund would help solve the problem.

Economist Daniel Gros working at the European Policy Center says getting money from IMF would not necessarily solve Greece's problems.

Under IMF rules, Greece would borrow money on condition it follow a program laid down by the fund. Should the program fail to return Greece from the brink, IMF would probably turn off the tap and demand repayment at high interest rates.

Gros says it can still work for Greece because it could be done in a few months. The problems of Greece, he said, were not going to be decided and be over in a couple of weeks.