Tuesday

21st Mar 2023

Greece will need third bailout, German minister says

A month before general elections in Germany, finance minister Wolfgang Schaeuble has broken the taboo of admitting that Greece will need a third bailout when the current one runs out, in 2014.

"There will have to be another programme in Greece," Schaeuble said on Tuesday (20 August) during a campaign rally in the northern-German town of Ahrensburg.

Read and decide

Join EUobserver today

Become an expert on Europe

Get instant access to all articles — and 20 years of archives. 14-day free trial.

... or subscribe as a group

  • Schaeuble: 'They are not out of the woods yet' (Photo: Constantine Gerontis)

As part of a third programme, he mentioned another lowering of the interest rates on the loans the eurozone has given to Greece.

"They are not out of the woods yet," he said.

So far, the German government has steered clear of admitting that the current bailout, worth €130 billion, will not suffice to get Greece out of the vicious spiral of deficit and debt.

Chancellor Angela Merkel, who is seeking re-election on 22 September, has meanwhile struck a more cautious tone.

"We always said that we will have to reassess the situation of Greece end 2014 or beginning of 2015. It is wise to stick to this calendar," she told Ruhr-Nachrichten on Tuesday.

Earlier this year, Germany's insistence not to deal with a funding gap of almost €10 billion for 2015-2016 delayed the negotiations on the second bailout for Greece, as the International Monetary Fund (IMF) was reluctant to sign off on a programme that does not get the country out of its financial mess once and for all.

The IMF was insisting at the time for EU governments to also take a cut on their loans to Greece, in order to lower the country's debt.

But Schaeuble on Tuesday again ruled out another debt restructuring for Greece, after private creditors agreed to lose more than half of their money on Greek bonds as part of the second bailout.

Speaking to foreign correspondents in Berlin on Monday, Green opposition leader Juergen Trittin said he expects another debt restructuring, adding that "Merkel always delays a decision until the very last moment, even if in the end it turns out to be more costly."

The German central bank is meanwhile also expecting a third bailout for Greece shortly after the German elections or "early 2014, at the latest," German weekly Spiegel reports, citing an internal Bundesbank document.

German finance minister visits angry Greece

German finance minister Wolfgang Schaeuble is due in Athens Thursday just as the Greek parliament, amid large street protests, passed a bill that will see thousands of public sector jobs cut.

ECB downplays third bailout for Greece

The European Central Bank has downplayed talk of a third bailout for Greece and said no new decision will be taken before spring.

Analysis

Why did Schaeuble break the Greek bailout taboo?

German finance minster Schaeuble put a cat among the pigeons by saying Greece will need a third bailout, a taboo before September elections. But insiders say it was no accident.

'Final warning' to act on climate change, warns IPCC

The United Nations's report — synthesising years of climate, biodiversity, and nature research — paints a picture of the effects of global warming on the natural world, concluding there is "no time for inaction and delays."

Latest News

  1. Turkey's election — the Erdoğan vs Kılıçdaroğlu showdown
  2. When geopolitics trump human rights, we are all losers
  3. EU starts talks on 11th round of Russia sanctions
  4. EU fears Tunisia turmoil will spark migrant boat departures
  5. 'Symbolic' Putin indictment gets some EU backing
  6. 'Final warning' to act on climate change, warns IPCC
  7. 'No one is unemployable': the French social experiment
  8. Why can't we stop marches glorifying Nazism on EU streets?

Stakeholders' Highlights

  1. Nordic Council of MinistersNordic and Baltic ways to prevent gender-based violence
  2. Nordic Council of MinistersCSW67: Economic gender equality now! Nordic ways to close the pension gap
  3. Nordic Council of MinistersCSW67: Pushing back the push-back - Nordic solutions to online gender-based violence
  4. Nordic Council of MinistersCSW67: The Nordics are ready to push for gender equality
  5. Promote UkraineInvitation to the National Demonstration in solidarity with Ukraine on 25.02.2023
  6. Azerbaijan Embassy9th Southern Gas Corridor Advisory Council Ministerial Meeting and 1st Green Energy Advisory Council Ministerial Meeting

Join EUobserver

Support quality EU news

Join us