–Adds Comments By German Government To Story Sent At 08:05 GMT
BERLIN (MNI) – The International Monetary Fund has signaled that it
will not contribute to further financial aid for Greece, raising a
greater risk of insolvency in September, the German weekly Der Spiegel
According to the magazine, high-ranking IMF officials have already
informed the EU leadership of its intentions.
German Finance Ministry spokeswoman Marianne Kothe said Monday that
“we have no information by the IMF regarding this.”
It is already clear that Greece won’t be able to meet the target of
cutting its debt to 120% of GDP by 2020, Der Spiegel wrote. Granting
Greece more time to meet its budget consolidation goals would require
E10-50 billion in additional aid, according to estimates by the troika –
the EU Commission, the ECB and the IMF, the magazine said.
German daily Sueddeutsche Zeitung reported Monday that Germany and
many other Eurozone member states are also not willing to grant Greece
additional financial aid. German Chancellor Angela Merkel is not
prepared to ask parliament to approve more aid for Greece, the paper
cited government sources as saying.
German government spokesman Georg Streiter on Monday refused to
comment on how Merkel would position herself if further aid for Greece
would become necessary.
The risk of Greece leaving the Eurozone is now seen as manageable,
Der Spiegel said. In order to avoid a contagion effect, Eurozone
governments want to wait until Europe’s permanent rescue fund ESM is in
operation. A first ruling by the German Constitutional Court on the ESM
is scheduled for September 12.
In the meantime, the ECB might bridge the gap, Der Spiegel wrote.
On August 20, Greece needs to pay back some E3.8 billion to the central
bank. Athens might sell that amount of T-bills to Greek banks, which
could then use the bonds as collateral with the ECB.
Ministry spokeswoman Kothe said that a decision on the planned next
aid tranche for Greece of E31.3 billion will only be made by Eurozone
finance ministers in September when the latest report on Greece by the
troika will be available.
Any funding gaps of Greece in August will have to be bridged by
Greece itself by issuing short-term debt paper on the markets, Kothe
German Economics Minister Philipp Roesler told German ARD public
television in an interview aired Sunday that Greece will most likely not
be able to meet the goals agreed with its international lenders. “I want
to say this here very clearly: if Greece does not meet its obligations,
there can be no further payments to Greece,” he stressed.
In that case, Greece might come to the conclusion that it would be
better to leave the Eurozone, said Roesler, who is also vice chancellor
and head of the free market-orientated FDP, the junior partner in the
government coalition. “I think that for many experts, for the FDP, and
for me, a Greek exit from the Eurozone has long since lost its horror,”
Spokesman Streiter said Monday that the German government “is
hopeful” that Greece will still be able to meet its committments.
–Berlin bureau: +49-30-22 62 05 80; email: email@example.com