Athens, September 1, 2015/ Independent Balkan News Agency
By Spiros Sideris
Chancellor Merkel left room for the extension of the grace period in the repayment of Greek loans, but not to the lowering of interest rates, pointing out that the European treaties do not allow the “bail-out”, and stressed that the issue is Greece’s burden for the service of the debt, which, as she said, should be at 15%.
“We have a legal situation, where there is a ban on ‘bail-out’ in the EU treaties. The room for the debt relief depends on this. We now have a discussion on how the debt sustainability will be calculated. We have a special situation. The IMF has its rules regarding when it want the debts to be returned, the ECB has its rules on when it wants to receive the interest payments.
The lenders of Greece under the ESM have given Greece a long grace period and very low interest rates. As regards with interest rates, I think we have no more room, because they are already very low. Everything that you would not even reflect the funding of the ESM would be a ‘bail-out’, but in the grace period we have some room”, she said.
And stated that “given the specific nature of the Greek State in relation to the ESM, we do not only talk about a debt at 120% of the GDP, but the actual charge generated to Greece towards the repayment of the debt”.
She added that 15% of the GDP could act as a measurement and reminded that “until 2022 or 2023 Greece does not need to pay anything and the burden is much lower than 15%, while there are other EU members, which say that their own debt, although smaller than that of Greece, entails greater internal charge from that of Greece today”.
And when the obligation to repay the debt begins, the Chancellor continued, we must look to keep it at 15%.
“I’m optimistic about this, we will achieve a setting which will reflect both the requirements of the IMF and the possibility of solving the problem”, she stressed,
Optimistic for Greece
“I believe that Greece will fulfill its obligations”, said the German Chancellor, referring to the third assistance program and the forthcoming elections.
“We have in the meantime a programme for Greece, a third programme. We have disbursed the first tranche of this programme. There will be new elections in Greece and I believe that Greece will fulfill its obligations”, she said in her inaugural placement, during a press conference she granted in Berlin.
Germany was not isolated
Germany was in no way isolated in the negotiations on the Greek programme, Merkel stressed and rejected the assumption that the country’s image suffered because of the German government’s handling.
She stated that Europe was active and united on the issue of Greece, and noted that she feels “good” with herself.
“If you look at the picture of the negotiations at the European Council, Germany was in no way isolated. Both myself and the minister of finance can attest to that. And if I needed to explain it, I would say that Germany has contributed immensely for Europe to respond united on the issue of Greece”, she said and pointed out that “there were countries that may have be willing to help with simpler terms, but also countries that were very generally very critical in terms of whether we should continue to help”.