• Germany's news in English
 
Berlin firmly against debt 'haircut' for Greece
Anti-austerity protester in Athens demands a 50 percent 'haircut' Photo: DPA

Berlin firmly against debt 'haircut' for Greece

Published: 26 Nov 2012 12:36 GMT+01:00

"We are going into this meeting with the hope that a solution can be found to all outstanding questions," government spokesman Steffen Seibert told reporters at a regular news conference.

Later on Monday, eurozone ministers will attempt for the third time to clinch agreement on unfreezing a vital instalment of bailout aid worth about €31.2 billion as Greece stares again into the bankruptcy abyss.

But Seibert stressed again Berlin's opposition to a so-called "haircut" on Greece's debt - meaning that other eurozone governments and the European Central Bank would accept a write-down on the debt they currently hold.

"This official sector haircut is also not a topic for other countries in the eurozone. That's why the finance ministers will not be talking about it. It's also not a topic for the ECB," insisted Seibert.

Greece's private creditors have written off more than €100 billion in debt, and the IMF has urged the ECB, a public creditor, as well as other eurozone governments, to accept this solution.

With less than a year until elections, Germany is unwilling to take losses on its holdings of Greek debt and the ECB believes it is tantamount to monetary financing of a eurozone country - strictly forbidden by its founding treaty.

Seibert also pointed to legal complications."It is true that there are significant political objections to such a haircut. But above all, there are clear legal objections and not just in Germany," he said.

He noted that German budgetary law as well as EU laws stating that no country may bail out another stood in the way of a haircut.

Politically, he said that if Greece were granted a haircut, then other countries under an EU bailout programme might also want one.

AFP/jlb

The Local (news@thelocal.de)

Your comments about this article

14:44 November 26, 2012 by Berlin fuer alles
What loan shark ever does accept a debt reduction from their victim?
20:49 November 26, 2012 by axlathi
Germany needs to stop living in denial - one way or the other, fair or not, they're going to have to foot a good portion of the bill. But the fact of the matter is, Germany has benefitted hugely from the EU and the euro, not least because a large amount of the debt incurred by countries like Greece was spent on German goods, and paying to help the euro zone extricate itself from the crisis, and stop acting as a brake on the world economy (and therefore German exports) is ultimately an investment in Germany's own future prosperity, especially given that the PIGS have been forced to enact reforms that will make them much more productive and potentially successful economies and societies moving forward. Alas they have waited a little too long to also reap the PR benefits of being saving Europe in its moment of need, which would have been a nice change given its reputation in the first half of the last century.
23:50 November 26, 2012 by Berlin fuer alles
You are right axiathi but Germany is doing what any loan shark does. Cutting off some limbs of the poor debtor in order to extract what is owed is an age old practice of loan sharks. Greece's balls are in a jar and Germany insists on kicking them everytime Greece is slow to repay the unsustainable debt Germany persuaded it to take out. Common practice from common criminals masquerading as elected representatives.
14:45 November 28, 2012 by raandy
If they do not write the debt down and keep loaning only to allow Greece to restructure it's debt, then they are only kicking the proverbial can down the road.

Christine Lagrade has hit out at EU need to write off some of Greece's debt to make it manageable. This has put her at odds with Chancellor Merkel who is facing reelection this coming September.

I would assume after the election the Chancellor would be more in favor of the so called hair cut.
Today's headlines
German-Turkish group against far-right talks
Protesters in Munich rally against the PEGIDA organization. Photo: DPA

German-Turkish group against far-right talks

A Turkish community leader in Germany warned on Sunday against proposals by mainstream politicians for "dialogue" with a far-right populist movement that has drawn thousands to anti-Islamic street protests. READ  

Merkel calls for truce talks over Ukraine crisis
Angela Merkel and Ukranian President Petro Poroshenko. Photo: DPA

Merkel calls for truce talks over Ukraine crisis

German Chancellor Angela Merkel on Sunday welcomed a prisoner swap between Ukraine's government and pro-Russian rebels but expressed regret about the stalling of truce talks. READ  

Germany warns Greece over reforms as left rises
Finance Minister Wolfgang Schäuble has said he expects Greece to honour its debts. Photo: DPA

Germany warns Greece over reforms as left rises

Germany's finance minister has warned Greece that any new government must respect commitments made by its predecessor, as the country moved closer to early elections that EU officials fear would be won by a radical leftist party. READ  

LG offices raided over suspected vandalism
A Sumsung washing machine. Photo: DPA

LG offices raided over suspected vandalism

South Korean prosecutors raided the Seoul headquarters of LG Electronics on Friday following allegations that the firm's executives vandalised their rival Samsung's washing machines at a trade fair in Germany, company officials said. READ  

Neuer cautious over Ballon d'Or prospects
Photo: DPA

Neuer cautious over Ballon d'Or prospects

Germany's World Cup winning goalkeeper Manuel Neuer on Friday played down his prospects of securing the World Player of the Year award over holder Cristiano Ronaldo and Lionel Messi. READ  

News Feature
No Boxing Day football tradition for Germans
Germans football fans will have nothing to watch this Boxing Day Photo: DPA

No Boxing Day football tradition for Germans

Defying national stereotypes, it is British footballers who will be braving the freezing cold to take to the pitch on Boxing Day, whilst Germany's players are already sunning themselves on their winter break until the end of January. READ  

Germans hit back at anti-immigrant movement
Demonstrators protest against PEGIDA. Photo: DPA

Germans hit back at anti-immigrant movement

Business leaders, the political class and average Germans are pushing back against a growing anti-immigrant movement, saying it threatens the values and image the country fought hard to establish since the war. READ  

German president urges refugee compassion
Photo: DPA

German president urges refugee compassion

Germany's president appealed in a Christmas message for compassion and openness towards refugees coming to the country, which is grappling with a growing anti-Islam movement. READ  

Reward offered for €150k homing pigeon
A female homing pigeon. Photo: DPA

Reward offered for €150k homing pigeon

A breeder in Düsseldorf has offered a €10,000 reward after thieves stole a homing pigeon worth €150,000 from his aviary. READ  

Royal palace restored to glory after €4.5m refit
The vestibule of the Schloss Charlottenburg, which reopens on Boxing Day Photo: DPA

Royal palace restored to glory after €4.5m refit

The royal palace of Fredrick the Great in Berlin is to fully reopen to visitors on Boxing Day after a 4.5 million euro refit. READ  

RECEIVE OUR NEWSLETTER AND ALERTS
Gallery
Top 12 German idioms
Willy Brandt at his inauguration in 1972. Photo: DPA
National
Willy Brandt: the man, the chancellor... the airport?
Dresden skyline and river by night. Photo: DPA
Politics
What does Dresden have against Muslims?
Sponsored Article
Why are these International Baccalaureate students cheering?
Germany's national football team lifts the World Cup trophy
Gallery
Germany's most-Googled words of 2014
National
Why has The Local got a new logo?
Photo: DPA
National
This German was abducted and tortured by the CIA
Culture
10 top tips for partying in Germany
Sponsored Article
Top ten gifts for an expat Christmas
Photo: DPA
Technology
What does the Chancellor see as the future of the internet?
Photo: DPA
Culture
Stuff your face with these festive German cookies
Photo: DPA
Culture
What do beer, breakfast cereal and dildos have in common?
Culture
The Local's guide to German Christmas markets
Sponsored Article
Top five quirky Christmas jumpers
Photo: DPA
Culture
Get ready for Christmas like a German. We tell you how.
Photo: DPA
Munich
She did what with her dead mother?
Photo: DPA
National
Germany still paying for crisis fall out
Photo: DPA
Culture
Saxon wurst is the worst, Christmas market declares.
Photo: DPA
Politics
Can 'sorry' ever be enough for the Linke?
Photo: DPA
Berlin
The Local's series on 25 years since the fall of the Berlin Wall
Photo: DPA
Gallery
See how Berlin has changed in 22 photos
Photo: DPA
Business & Money
JobTalk: All you need to know about working in Germany
National
Share news tips with The Local Germany
Latest news from The Local in Austria

More news from Austria at thelocal.at

Latest news from The Local in Switzerland

More news from Switzerland at thelocal.ch

Latest news from The Local in Denmark

More news from Denmark at thelocal.dk

Latest news from The Local in Spain

More news from Spain at thelocal.es

Latest news from The Local in France

More news from France at thelocal.fr

Latest news from The Local in Italy

More news from Italy at thelocal.it

Latest news from The Local in Norway

More news from Norway at thelocal.no

Latest news from The Local in Sweden

More news from Sweden at thelocal.se

3,056
jobs available
The Local Spain is hiring!
The Local is seeking a new editor for our site in Spain to join our growing team of internationally-minded, driven, ambitious and clued-up journalists.
Details and how to apply
Toytown Germany
Germany's English-speaking crowd