Too early to de­cide, says Merkel

Ger­man chan­cel­lor wants de­tails on Greek progress; ECB of­fi­cial in fa­vor of pro­vid­ing more time

Kathimerini English - - Business & Finance -

Spec­u­lat­ing on whether or not Athens can re­pay its debts does not help Greece, Ger­man Chan­cel­lor An­gela Merkel said yes­ter­day.

“We don’t do Greece any fa­vors if we spec­u­late” on the out­come of re­forms and how the coun­try will man­age its pub­lic debt, Merkel told a press con­fer­ence in Ber­lin.

Euro­pean Union, Euro­pean Cen­tral Bank and In­ter­na­tional Mon­e­tary Fund au­di­tors are cur­rently in­volved in a quar­terly re- view of the Greek re­form drive amid wor­ries that Athens could de­fault on its debt or ask for it to be re­struc­tured, thereby im­pact­ing the en­tire eu­ro­zone.

“The mis­sion is still in Greece. It is my un­der­stand­ing they will be there un­til the end of the week. There­fore I’m wait­ing on the find­ings of this mis­sion,” Merkel said.

“I am of the opin­ion that the con­clu­sions to be drawn from the find­ings must await the find­ings,” the Ger­man chan­cel­lor added when asked if Ber­lin was pre­pared to agree to ad­di­tional aid for Greece.

A bailout pack­age for Greece, put in place a year ago, cur­rently in­volves in­ter­na­tional loans of 110 bil­lion eu­ros over three years.

Se­nior EU and Greek of­fi­cials have de­nied that any re­struc­tur­ing of the debt is on the agenda.

Euro­pean Cen­tral Bank pol­i­cy­maker Ewald Nowotny in­di­cated yes­ter­day he was in fa­vor of giv­ing Greece more time to re­pay its fi­nan­cial aid rather than is­su­ing new loans. Nowotny said a Greek debt re­struc­tur­ing would dam­age both Greece and other coun­tries in the 17-mem­ber eu­ro­zone.

“You have to be aware that this would im­me­di­ately have mas­sive con­se­quences for the Greek bank­ing sys­tem and for the bank­ing sys­tem over­all,” the ECB pol­i­cy­maker told Aus­trian ra­dio. “That would only heighten the cri­sis.”

Nowotny said it was pri­mar­ily up to Greece to put its fi­nan­cial house in or­der and that a re­struc­tur­ing must be avoided.

Asked whether Greece would get fresh loans, he said: “The first step has to be on Greece’s side. Only when we have a clear view here can we con­sider whether the ex­ist­ing pro­gram must be rounded out, but that is some­thing one can judge only in the weeks ahead.”

An­other ECB pol­i­cy­maker, Juer­gen Stark, said yes­ter­day a debt re­struc­tur­ing wouldn’t solve Greece’s prob­lems.

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