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Schaeuble: Greece must leave the Euro to win a Debt Cut

 German Finance Minister Wolfgang Schaeuble warned Greece Wednesday night “to fulfill its reform commitments, otherwise it would have to leave the Eurozone.” Speaking at a talk show at the German state ARD TV, Schaueble said also that pressure on Greece must be maintained.”

“They are not over the mountain, therefore pressure on Greece must be maintained, so that it reforms and become competitive,” Schaeuble said adding “Otherwise they can not remain in the monetary union.”

If the Greeks did not take the necessary reforms, “they would have to go the other way,” the German fiance minister said. “This is a decision that affects Greece.”

He does not reckon with “Grexit”, though, he said further. If the Greeks fulfilled their commitments to the EU-lenders, the ongoing aid program would be successfully implemented by 2018.

Schaeuble pointed out that there could be no debt cut for a euro-member country. No country of the monetary union may be liable for another euro country.

“Greece would have to leave the monetary union to win a debt cut. If reforms fail, there is the instrument of the currency devaluation. But this is a matter of Greece,” Schaeuble said.

The most serious problem for Greece is currently not the debt. The country currently has to pay less interest than Germany on its debts. Greece, however, had a higher living standard than it can generate. The pensions are roughly higher than the average of the euro area countries.

“That’s why the problem is competitiveness,” Schaueble added. The country needs to reconcile its real possibilities with the demands. The country needs a powerful administration. In large parts, no taxes would be levied. Some things had been a bit better. Economic growth was better in 2016 than the International Monetary Fund (IMF) had predicted.

Schaeuble said also that he was concerned about a possible win of Marie Le Pen in France because of Donald Trump. He said, he feared Le Pen’s win would bring  the end of the eurozone.


PS I thought no matter what the Greeks do, “Germany will stop the current Greek program if the IMF remains out.” as Schaeuble said just two days ago 😛

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  1. Come on Greece GREXIT already!

  2. Let us hope the IMF stays out, Wolfie pulls out, Greece at last declares bankruptcy (within the Euro) and the party starts. I don’t think Wolfie will enjoy it however, his other prisoners may revolt and demolish his beautiful cage…