Merkel dampens third bailout talk

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Published: Thursday 5th March 2015 by The News Editor

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German chancellor Angela Merkel and the president of the European Commission president have cautioned against speculation that Greece will need a third financial bailout.

Though Greece’s new left-wing government has insisted it will not seek another bailout, the debt-strapped country could need some form of assistance to see it beyond the summer.

Greece and its creditors recently agreed a four-month extension to Athens’ second bailout to June.

Mrs Merkel said “we have our hands full” implementing that agreement, and “that’s what I am concentrating on”.

EU Commission president Jean-Claude Juncker said after meeting Mrs Merkel it is “premature” to speculate about another programme.

In Athens, finance minister Yanis Varoufakis also poured cold water on the idea.

He said: “I don’t know who said this, or who presented all this as a debate, even using specific sums. This is as far from the truth as it can get.”

On Monday, Spanish economy minister Luis de Guindos said that a third package was being negotiated, though his ministry said after he spoke that a third bailout was “hypothetical”.

Mr De Guindos later said Greece will need a new accord or program if it does not regain access to market financing by June.

He has said Greece could need as much as 50 billion euros (£36 billion) in further assistance.

Greece is pressing bailout lenders to reduce its debt load with more generous repayment terms that would effectively write off a portion of its debt.

Mr Varoufakis said he believed lenders are taking a tougher line with his government than the previous conservative administration in Greece and other bailed out eurozone members.

“The powers that be in Europe have decided that this government needs to be treated less leniently than others. It is my considered opinion that this is a political choice,” he said.

“I hope this is an aberration and that this government is the leeway that it deserves given our commitment to reform Greece.”

Published: Thursday 5th March 2015 by The News Editor

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