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The ability of the Italian government to enact broad structural reforms "is absolutely key to the success of the whole endeavor," said Bruegel's Wolff.

"If Italy doesn't mange to make the reforms that are necessary, we will face extremely difficult decisions in the euro zone," he said.

How does the ECB fit in?

The role the European Central Bank will play in ongoing rescue efforts is also a major unknown.

The ECB has been buying billions of euros worth of government bonds under a controversial emergency program. The bond buying has already led to the resignation of two key German central bankers who objected to the ECB taking on risky sovereign debt.

Under its single mandate to "maintain price stability," the ECB is required to control inflation by managing interest rates. But the bank has argued that buying bonds is necessary to ensure that it can fulfill its mandate amid dysfunctional markets.

"We fully support the ECB in its action to maintain price stability in the euro area," the EU leaders said, according to the conclusions from the most recent summit.

But economists warn that the euro area needs a credible buyer of last resort for stressed government bonds.

"In our view, the role which the ECB will or will not play remains crucial," said Holger Schmieding, chief economist at Berenberg Bank.

-- CNN's Jaime FlorCruz contributed from Beijing To top of page

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