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Greece leaving the euro not so scary - Germans

The Local · 13 Feb 2012, 08:46

Published: 13 Feb 2012 08:46 GMT+01:00

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The Greek parliament voted on Sunday evening in favour of a savings package which includes job cuts and wage reductions – the price of releasing the next tranche of €130 billion from the euro emergency fund.

German Economy Minister Philipp Rösler would not rule out Sunday the prospects of Greece's exit from the eurozone, saying that "D-Day" was becoming a "less scary" prospect.

Asked during an interview with German television ARD about a possible exit of Greece from the eurozone, Rösler replied: "It's in the hands of the Greeks."

"D-Day is less and less scary," he added later in the interview. Rösler also pushed Greece to commit more to reforms, saying that it was making less effort than Portugal and Spain, according to a text of the interview published ahead of the broadcast.

On Monday he told the Morgenmagazin television programme it was crucial that the reforms were actually implemented – only then would the money be released. He said it was correct to push the Greek government in what he called the “right direction”.

He would not say he was confident the measures would be implemented, pointing to Greek tax laws which had been on the books for ages but not properly enforced.

Rösler was the third German minister to call on Sunday for Athens to implement reforms quickly.

In an interview with weekly paper Welt am Sonntag, Finance Minister Wolfgang Schäuble said: "Greece's promises are insufficient for us. They must... first implement parts of the previous programme and save."

Foreign Affairs Minister Guido Westerwelle told news magazine Der Spiegel that "it is not enough to adopt reform programmes. It is also necessary to begin without delay the implementation of these reforms.

Story continues below…

“Not any time, but now."

DPA/AFP/The Local/hc

The Local (news@thelocal.de)

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Your comments about this article

10:09 February 13, 2012 by Bushdiver
I see again the market has reacted very slowly to this approval by the Greeks. Only the French and Germans think that pooring more money into a sinking ship is going to save Greece and the Euro. Another 130 million out the window. The only way Greece will ever get out of this mess is if all debt is forgotten. How can Greece implement all these reforms while at the same time cutting thousands of jobs, Are they growing Euro's now instead of Olives?
11:29 February 13, 2012 by raandy
Even if all their debt is written off they still will not be able to turn it around and get in line with the financial standards of the Euro Zone.

Leaving the zone may in the end be the only option.
12:03 February 13, 2012 by ChrisRea
@ Bushdiver

So if the following working day all the European markets are going up, it means that they react slowly? When would you have expected them to react? On Sunday?

How can Greece implement the reforms and in the same time cutting thousands of jobs? Maybe just like Romania did (with much harsher austerity measures: 100,000 government jobs cut, 25% wage reduction for the remaining ones, VAT increased from 19% to 24%, social benefits cut by 15%).
12:40 February 13, 2012 by murka
To put it into perspective. 130 bn is a loan, not just money given away. What part of it comes from German taxpayers?

40 bn was given to Berlin-Brandenburg through LFA (domestic equalization payments). Not a loan, money just given away.

Isn't it curious that I feel better of loaning my money to Greeks rather than throwing them at Brandenburg. Something wrong with me? Am I being

13:59 February 13, 2012 by jg.
Last I heard, there's still a shortfall, despite the money on the table for this bailout.

Will this entire bailout process be repeated every time Greece has a loan repayment due? If so, how many of these will it take before everyone recognises that this situation is not sustainable?

Maybe it would be better to plan for Greece's orderly exit from the Euro, rather than the alternative of maintaining the pretence that it can be prevented and having their default happen in an uncontrolled manner.
15:47 February 13, 2012 by murka

My understanding is that as of now Greece has a balanced budget. The bailout is about previously accumulated debt. About replacing private borrowers (with predatory practices) with the fellow Euro countries.
20:02 February 13, 2012 by Englishted
Wake up ,if Greece leaves there is another country waiting to take their place e.g. Ireland,Spain,Italy .

What are you going to do then?

Send Guido Westerwelle to verbally abusive them or just keep replacing then with E.U. appointees.
11:08 February 14, 2012 by Navigator_B
Murka, the Greek government's existing private loans will have to be paid some time by somebody. For a start they are due to repay 14 billion Euro next month when that amount of Greek government bonds is due.

If the EU agrees to a bailout, the holders of those bonds will pocket that money. If not, Greece will have to default because it could not get a new loan from anyone in the private market to re-finance the bonds (loans). It is therefore really a bailout for the bondholders, many of whom are German banks.

One way or another, a large part of the Greek loans will be paid by Germans. It's just a question of how much will be paid by German banks and how much by German citizens.
19:36 February 17, 2012 by koll

You didnot understand situation, greece still getting debt.Greece has %7 budget deficit now.They still complain about EU and want more money to pay their 1200.000 government officers salaries.
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