News24

Germany warns Greece on failed promises

2012-02-12 12:05

Berlin - Greek promises on austerity measures are no longer good enough because so many vows have been broken and the country that has been a "bottomless pit" has to dramatically change its ways, German Finance Minister Wolfgang Schaeuble said.

In a hard-hitting interview with the Welt am Sonntag newspaper, Schaeuble also said it is up to Greece whether the country can stay in the eurozone as part of its efforts to restore its competitiveness.

"The promises from Greece aren't enough for us anymore," Schaeuble said. "With a new austerity programme they are going to first have to implement parts of the old programme and save."

Schaeuble pointed out that German opinion polls show a majority of Germans are willing to help Greece.

"But it's important to say that it cannot be a bottomless pit. That's why the Greeks have to finally close that pit. And then we can put something in there. At least people are now starting to realise it won't work with a bottomless pit."

Rescue efforts

Schaeuble said Greece would be supported "one way or another" but warned the country needed to do its homework on improving its competitiveness and hinted it might have to leave the eurozone to do that.

"Greece needs to do its own homework to become competitive - whether that happens in conjunction with a new rescue programme or by another route that we actually don't want to take..."

When asked if that meant Greece would leave the eurozone for that, Schaeuble said:

"That is all in the hands of the Greeks themselves. But even in the event [Greece leaves the eurozone], which almost no one assumes will happen, they will still remain part of Europe."

Schaeuble said Germany, the eurozone's paymaster, wanted to prevent that.

"We're happy to help but we shouldn't give others the feeling that they don't have work hard themselves. Every country is responsible for itself."

He said that the rescue efforts for Greece are turning out to be more difficult than efforts associated with German reunification in 1990.

"The reason is the realisation that there is a need for change, and change dramatically, still needs to develop further with a lot of people in Greece," said Schaeuble, who was a key government architect of German reunification.

Schaeuble said there was quite a difference between Greece and other euro zone strugglers.

"The Greeks are a special case...The Portuguese government is doing a decent job," he said, adding that Portugal's problem is that the country needs more economic growth.

"Our goal is to help give Greece a future by making it fit and competitive so that the people there have their chances," he said. "But the path is going to be difficult."

Comments
  • Fidel - 2012-02-12 12:15

    Sovereign defaults are part of tooth and nail capitalism - you lend money to someone who's a poor credit risk and you risk losing your money. Argentina defaulted in 2002, froze the banks, declared its foreign debts void, and cut itself off from IMF funding – and since then, it's been the fastest-growing economy in fast-growing South America.

      goyougoodthing - 2012-02-12 14:27

      BS. The Greeks did it to themselves.

      Fidel - 2012-02-12 15:13

      Which part of my post is BS? Lets argue some facts instead of throwing pointless ad hominem, shall we.

      Yar - 2012-02-12 20:08

      @Fidel Which part. - All of it. Argentina and Greece are not the same. The rule is simple. You make an agreement to borrow money and then you pay it back. If you don't do that, you will never get another chance. Borrowing money with the intent to avoid paying it back, is tantamount to stealing. Greece has borrowed money to waste. The national sport is tax evasion. They are trying to borrow more money to fund their lifestyle. It's not going to happen.

      Fidel - 2012-02-12 20:30

      The high interest returns compensates for the risks. That's the way capitalism works, doesn't it? Of course Greece would have to default, what is it going to do, borrow its way out of debt?

      Yar - 2012-02-12 21:09

      @Fidel There is no point in taking a risk at any price, unless you get your money repaid. Fidel, where did you learn about business? Malema's woodwork teacher.

      Fidel - 2012-02-12 21:16

      Okay, now you're in troll territory and it's no longer worth addressing you.

      Yar - 2012-02-12 21:16

      @Fidel, my socialist buddy, the Greeks do have options: 1 Cut expenditure back to an AFFORDABLE level. (less than or equal to the level of income) 2 Everyone in Greece must pay their fair share of tax. 3 Repay the loans. Easy as 1 2 3. Borrowing your way out is not an option.

  • goyougoodthing - 2012-02-12 12:16

    Just kick them out. If they can't handle their finances why should everyone else suffer.

      Fidel - 2012-02-12 12:37

      If that were the case, you will then have an EU made up of only Germany and France, as England haven't entirely bought into the EU principle.

      goyougoodthing - 2012-02-12 13:02

      Only Germany and France are any good at it... and the EU and Euro was a bad idea in any case

      Eleni - 2012-02-12 14:08

      who is suffering exactly??? Do you have any idea what you're talking about? you have no idea what SUFFER means. kick them out?? If the greeks don't handle their finances well, that's because their SNEAKY allies in Europe and across the Atlantic are doing everything to prevent them.

  • Nherera Lovemore - 2012-02-12 12:49

    poor headline, i thought its staging another world war.

  • Angling - 2012-02-12 13:43

    No change. Take some chappies.

      Wouter - 2012-02-12 20:29

      @Angling - LMAO! Perfect metaphor!

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