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Germany won’t give a cent to Greece

The German government will “not give one cent” to help Greece out of its debt crisis, Economy Minister Rainer Bruederle said as the two countries’ leaders prepared to meet in Berlin.

world Updated: Mar 06, 2010 01:44 IST

The German government will “not give one cent” to help Greece out of its debt crisis, Economy Minister Rainer Bruederle said on Friday as the two countries’ leaders prepared to meet in Berlin.

Greek Prime Minister George “Papandreou said that he didn’t want one cent — in any case the German government will not give one cent,” Bruederle said. The remarks came ahead of talks later on Friday between Papandreou and Chancellor Angela Merkel amid rising tension between the two countries.

Bruederle was referring to comments by Papandreou in Germany’s Frankfurter Allgemeine newspaper published on Friday.

“We are not asking for money,” Papandreou said.

“We need support from the European Union and our partners to obtain credit on the markets at better conditions. If we do not receive this aid, we will not be able to enact the changes we foresee.”

Greece successfully raised an urgently needed 5.0 billion euros (6.8 billion dollars) with a bond issue on Thursday, but had to pay an interest rate significantly above 6.0 per cent, or about twice the rate at which Germany can borrow.

Papandreou has made clear that he is looking for some form of expression of “solidarity” which would enable Greece to share some of the credibility attached to other eurozone governments, notably Germany, so that future bonds can be issued at a lower rate.

Germany, Europe’s biggest economy, is widely seen as the most likely candidate to help prevent what would be a disastrous Greek default but there is strong opposition in the country against such a move.

Greek politicians have bristled over insulting headlines in the German press and editorials denouncing the corruption there, although Papandreou himself has acknowledged the problem. Media reports have suggested that for all the stern words, Germany is drawing up contingency plans behind the scenes including either bilateral aid, joint European action or help from the International Monetary Fund.