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EUROZONE

Berlin: EU should manage Greek budget

Germany wants the EU to take control of the Greek budget as the eurozone loses patience with Greece's reform efforts, officials said on Saturday as Athens categorically dismissed the idea.

Berlin: EU should manage Greek budget
Photo: DPA

“There are discussions and proposals in the heart of the eurozone, including one from Germany” to “reinforce control over programmes and measures already in place,” a European source said.

The source was confirming a report in the British Financial Times newspaper, that Germany’s plan was for a commissioner appointed by the other eurozone finance ministers to be able to veto budget decisions made by the Greek government.

The report came as Greek officials were in talks with private creditors on a major debt write-down to avoid a looming default, and ahead of a meeting of EU leaders in Brussels on Monday focused on a new fiscal pact.

“Budget consolidation has to be put under a strict steering and control system,” the Financial Times quoted the proposal as saying, adding that it had been circulated by Germany on Friday to officials from other eurozone countries.

“Given the disappointing compliance so far, Greece has to accept shifting budgetary sovereignty to the European level for a certain period of time.”

The European source said: “A clear priority has to be given to reducing the budget deficit… In Greece, there is a particular problem of a very decentralised budget policy. A constraining legal framework could bring more coherence and ease and accelerate the decision-making.”

“External expertise on the ground could be run by European institutions and could also have certain decision-making powers,” the source said, requesting anonymity.

But Greece dismissed the idea amid increasing resistance in Athens to demands for ever greater sacrifices.

“There is effectively a ‘non-paper’ that was presented to the eurogroup,” a Greek government source told AFP in comments echoed by others.

“Greece will not discuss such a possibility,” said the source. “It is out of the question that we would accept it, these are matters of national sovereignty.”

Such a move would “require a change in (EU) treaties.”

Greek Education Minister Anna Diamantopoulou, a former EU commissioner, slammed the idea as “the product of a sick imagination” in an interview with Mega television.

The latest row comes as Greece’s three-party coalition, ranging from socialists to the extreme right, is showing signs of cracks under the strain of battling the debt crisis.

The coalition was formed in November after socialist Prime Minister George Papandreou was forced from office for his handling of the crisis.

AFP/hc

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ANGELA MERKEL

German war crime payments debated in Greece

Greece's parliament on Wednesday began a debate on a resolution to demand the payment of German war crime reparations, an issue long disputed by Berlin.

German war crime payments debated in Greece
Angela Merkel and Alexis Tsipras in Greece in January. Photo: DPA

“These demands are always active. They were never set aside by Greece,” parliament chairman Nikos Voutsis told reporters this week.

The chamber is expected to approve later Wednesday, with cross-party support, a resolution calling on the government of Premier Alexis Tsipras “to take all the necessary diplomatic and legal steps to claim and fully satisfy all the demands of the Greek state stemming from World War I and World War II”.

A parliamentary committee last year determined that Germany owes Greece at least €270 billion for World War I damages and looting, atrocities and a forced loan during the Nazi occupation in World War II.

Reclaiming war reparations has been a campaign pledge by Tsipras since 2015. He faces multiple electoral challenges this year, with his party trailing in polls.

'Historical responsibility'

During a visit to Greece in January, German Chancellor Angela Merkel said her country “recognised its historical responsibility.”

SEE ALSO: Merkel says Germany recognizes responsibility for Nazi war crimes in Greece

“We recognize our historical responsibility. We know how much suffering we, as Germany in the time of Nazism, have brought to Greece,” she said.

In 2014, ex-president Joachim Gauck had also sought public forgiveness in the name of Germany from relatives of those murdered by the Nazis in the mountains of northern Greece.

But when it comes to actual payments, the German government has always insisted that the issue was settled in 1960 in a deal with several European governments.

Germany's government spokesman Steffen Seibert reiterated Wednesday that “the reparation issue is judicially and politically settled”. 

He said Berlin is doing “everything it can so Greece and Germany maintain good relations as friends and partners”. 

During the Greek economic crisis, there was further tension in Athens over draconian EU austerity and bailout terms seen to be imposed by Berlin hardliners.

Relations have improved over the last three years after Tsipras' government endorsed conditions linked to satisfying its creditors.

Tsipras and Merkel also worked closely on finding common ground on migration and Balkans security.

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