Schäuble warns Greece and woos Britain

Schäuble warns Greece and woos Britain
Finance Minister Wolfgang Schäuble in Brussels on May 11th. Photo: DPA
German Finance Minister Wolfgang Schäuble said he could not categorically rule out a Greek debt default as Athens negotiates with its creditors, US and French newspapers reported on Wednesday.

Asked whether he would repeat an assurance he gave in 2012 that Greece wouldn't default, Schäuble told The Wall Street Journal and French daily Les Echos: “I would have to think very hard before repeating this in the current situation.”

The radical left-wing and anti-austerity government of Greek Prime Minister Alexis Tsipras has been in a standoff with its lenders for months while battling recession and a liquidity crunch.

The EU and IMF creditors are demanding tough labour market and pension reforms in return for the final 7.2 billion euros ($8.0 billion) in bailout funds Athens desperately needs.

“The sovereign, democratic decision of the Greek people has left us in a very different situation,” said Schäuble, referring to the January election of the Tsipras government.

Schäuble — a champion of tough reforms and austerity — rejected the idea of discussing a third bailout package for Greece before the current programme is completed, said The Wall Street Journal.

“Greece has yet to complete the programme, it no longer has the primary surplus it had last year, and it has said repeatedly it doesn't want a new programme,” he was quoted as saying.

Former Greek prime minister, Socialist George Papandreou, on Wednesday called on the current government to reach a compromise deal with the country's international creditors and then put that deal to a national referendum.

“The overwhelming majority of Greeks want to remain in the euro, despite the suffering which they have endured,” he said during a speech in Estoril, west of Lisbon.

“The German taxpayer will be reassured if the Greek citizens say 'yes, we'll put this programme into operation',” Papandreou added.

His government fell in November 2011, weakened by the financial crisis.

While Schäuble has taken a tough stance on Greece, he said he was ready to talk with Britain about its demands to rewrite the rules of its EU membership, the report said.

He said he had invited his British counterpart George Osborne to discuss reform proposals on European treaties, including Berlin's wish for more centralized fiscal governance of the eurozone, of which Britain is not a member.

Schäuble stressed that “we have a huge interest in the UK remaining a strong and engaged member of the European Union”.

Member comments

Become a Member to leave a comment.Or login here.