Tue, Feb 18, 2014 - Page 15 News List

Merkel blocks offer of new aid to Greece


German Chancellor Angela Merkel has blocked a bid by her powerful finance minister to offer fresh aid to Greece ahead of European elections in May, Der Spiegel magazine reported on Sunday.

German Finance Minister Wolfgang Schaeuble had wanted to give the ailing Greek government a “demonstration of solidarity” by committing this spring to further support from Europe after the May 25 poll.

“He sees the danger that without the prospect of further aid, radical parties in Greece could make big gains in the election,” leading the government in Athens to collapse, the magazine reported.

However, it said Merkel’s own domestic political concerns led her to veto the move over fears that the Eurosceptic Alternative for Germany (AfD) could benefit from a fresh debate about aid for Greece.

The AfD, which wants to abandon the euro and return to the deutschmark, was formed last year and failed to win any seats in September’s general election. Yet it scored 7 percent in a recent poll, far above the 3 percent hurdle for seats in the European Parliament.

The Eurogroup of eurozone finance ministers, where Schaeuble represents Europe’s biggest economy, decided in November last year that Greece could apply for help in reducing its massive debt, if it achieves a primary budget surplus.

Greek Prime Minister Antonis Samaras said on Sunday that Greece had registered a surplus of more than 1.5 billion euros (US$2.05 billion), exceeding requirements for additional debt aid.

“We have created a primary surplus in 2013 when the target was for 2014 ... it is over 1.5 billion euros,” Samaras told To Vima weekly in an interview.

“Three times more than we originally calculated,” he said.

A month earlier, Samaras had placed the primary surplus — a budget surplus not counting debt servicing costs — at about 500 million euros.

It is the first time in more than a decade that the country has registered a primary surplus.

Greece hopes to utilize these savings in order to obtain assistance with its enormous debt from its international creditors later this year.

However, some European officials have expressed skepticism over the scope of Greece’s surplus claims.

EU data agency Eurostat is expected to formally announce the size of the surplus in April.

EU Economics Affairs Commissioner Olli Rehn said in an interview published on Sunday that he opposed further help for Athens ahead of the European elections.

He told Germany’s Welt am Sonntag that a debate about further debt relief for Greece could be discussed “over the summer or afterwards.”

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