Germany's Schaeuble cautious on Greece's ability to avoid default

20th May 2015, Comments 0 comments

German Finance Minister Wolfgang Schaeuble said he couldn't categorically rule out a Greek debt default as Athens negotiates with its creditors, US and French newspapers reported Wednesday.

Asked whether he would repeat an assurance he gave in 2012 that Greece wouldn't default, Schaeuble told The Wall Street Journal and French daily Les Echos: "I would have to think very hard before repeating this in the current situation."

The radical left-wing and anti-austerity government of Greek Prime Minister Alexis Tsipras has been in a standoff with its lenders for months while battling recession and a liquidity crunch.

The EU and IMF creditors are demanding tough labour market and pension reforms in return for the final 7.2 billion euros ($8.0 billion) in bailout funds Athens desperately needs.

"The sovereign, democratic decision of the Greek people has left us in a very different situation," said Schaeuble, referring to the January election of the Tsipras government.

Schaeuble -- a champion of tough reforms and austerity -- rejected the idea of discussing a third bailout package for Greece before the current programme is completed, said The Wall Street Journal.

"Greece has yet to complete the programme, it no longer has the primary surplus it had last year, and it has said repeatedly it doesn't want a new programme," he was quoted as saying.

While Schaeuble has taken a tough stance on Greece, he said he was ready to talk with Britain about its demands to rewrite the rules of its EU membership, the report said.

He said he had invited his British counterpart George Osborne to discuss reform proposals on European treaties, including Berlin's wish for more centralised fiscal governance of the eurozone, of which Britain is not a member.

Schaeuble stressed that "we have a huge interest in the UK remaining a strong and engaged member of the European Union."

© 2015 AFP

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