Hollande reiterated his desire to renegotiate the recently agreed Fiscal Pact during the meeting with Merkel in Berlin following his inauguration on Tuesday.

Both leaders said they want Greece to stay in the eurozone and they said they respected Greece's decision to hold a new general election.

Analysts said Europe had entered into a "critical and precarious" phase. European Council President Herman Van Rompuy said it was like "building a lifeboat while being at sea".

Though Brussels did not announce discussion points of the urgently scheduled "informal dinner" next Wednesday, Greece and the euro will top the agenda and upcoming G8 and NATO summits will also be discussed.

Jonathan Holslag, research coordinator of the Brussels Institute of Contemporary Chinese Studies, said the Wednesday dinner is an occasion for leaders to show their political will.

"Greek politicians seem not to have any option but to stay in," Holslag said.

"Overall, European leaders are committed to keeping Greece in the eurozone."

Wolfgang Pape, a former member of the European Commission, agreed that these are difficult times.

"Nevertheless, it is still too early to talk about Greece leaving the euro. Even if this did happen it would be a very long process.

Pape said he is optimistic about the election as he believes that parties supporting the bailout will emerge stronger.

Christos Vlachos, director of Athens-based China-Greece Business Council, also said Greece faces a dilemma, no one wants austerity and no one wants to leave the euro.

Recent polls consistently show about 80 percent of Greeks would like to stay on the euro.

Impact on China

Wei Liang, a researcher with the Institute of World Economic Studies at the China Institute of Contemporary International Relations, suggested replacing euro assets with German bonds.

China's outbound investment has been growing rapidly but not in Europe.

Liu, from the Institute of European Studies, said the situation could be advantageous for Chinese firms.

"Chinese companies will have the upper hand because Europe now faces a fund shortage."

Tan Xuan in Brussels contributed to the story.

Contact the writers at fujing@chinadaily.com.cn and weitian@chinadaily.com.cn