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Greece debt crisis: Is Merkel pushing Schaeuble aside for a political solution?

Greece’s Finance Minister Euclid Tsakalotos is in Brussels on Friday for a series of previously unscheduled meetings with the heads of the country’s European creditors. Additionally, Tsakalotos is also going to meet with German Chancellor Angela Merkel in the next days,  Athens News Agency reported on Friday morning.

That the German Chancellor meets with Greece’  Finance Minister – or any finance minister in general – is something that does not happen every day. Most likely, this is something that does not happen at all for pure protocol reasons.

How comes that a German Chancellor meets a Finance Minister? The potential  meeting comes a day after Angela Merkel urged eurozone members to demonstrate unity as one bloc. In her statement, Merkel even foiled the plan of her finance minister Wolfgang Schaeuble for a “two speed eurozone.”

“For me it is not a matter of two speeds within the euro zone,” Merkel said. “The euro zone must remain together. And what we agreed on should be delivered together by all the euro member states.”

A day earlier, Schaeuble had said that pressure on Greeks must be maintained and that Greece has to reform or leave the eurozone.

Last week, when Merkel had a private meeting Alexis Tsipras at the side of the EUCO Summit in Malta. The Greek Prime Minister tried to arrange a political solution with her, she turned the request down urging him to “find a solution within the eurogroup.”

However, in public opinion polls, Chancellor Merkel and her conservative, largely pro-Grexit party CDU see the dust behind the Social-Democrats and former European Parliament President Martin Schulz. Led by Schaeuble, the CDU but also the neo-liberal FDP, a former coalition partner of Merkel, have put Grexit on top of their election campaign.

Did the German Chancellor decided to push self-opinionated Schaeuble a bit aside and take the negotiations of Greece’s second review under her wings? Is a political decision on the Greek issue due? Will Merkel turns into a Mutti* also for Greeks and push for some relaxation of the strict austerity?

Of course, we should better tame our wildest fantasies and our expectations because Schaeuble was not deliberately acting in demanding the last drop of the Greek blood. Germany’s austerity policy was in line with the German Chancellor and its coalition partner, the Social-Democrats.

Tsakalotos’ “previously unscheduled meetings” aim to break the impasse in the negotiations to conclude the second review. Thursday’s Euro Working Group meeting brought zero results, Greece and the EU creditors did not agree mainly because the rift between EU and the IMF remain on the same grave level.

The Greek Finance Minister is to meet with Eurogroup chairman Jeroen Dijsselbloem, EU Commissioner for economic affairs Pierre Moscovici, ESM managing director Klaus Regling, ECB executive board member Benoit Coeuré most likely also with IMF European department director Poul Thomsen.

Creditors’ representatives will also meet together, reportedly without Tsakalotos.

Bloomberg reported that creditors will propose to Athens that it enact a package of new austerity measures worth 2 percent of current GDP, roughly 3.6 billion euros, measures that will be implemented in case fiscal targets fall short after 2018.

The IMF wants measure of 4.9 billion euros.

According to state broadcaster ERT, Alternate Finance Minister Giorgos Houliarakis said “it was best to find even a bad solution now, rather than a better one (solution) in five months.” He added that the main difference between creditors over the Greek bailout program is how much debt relief German and European partners are willing to concede for Athens.

Schaeuble had said that “a debt cut was not possible within the eurozone” and that if Greece wanted it “it should leave the eurozone.”

*Merkel acquired the nickname “Mutti” (a German familiar form of “mother”), in reference to an idealized mother figure for the nation.

UPDATE: Friday afternoon, the German government and the Finance Ministry said no meeting was scheduled neither with Angela Merkel not with Wolfgang Schaeuble with the Greek finance minister.

PS if I charge €10 every time an unethical  German politician misuses #Greece and #Grexit for his own their political benefits, by Sept 24th I will have gotten together enough money to survive financially for four to five years.

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  1. There is no way that the 4th Reich abandon their plans for colonising and devastating Greece. They will insist and keep on trying with the pigheadedness of their dear Adolph. The only way to stop them is an out right confrontation regardless of any consequences. We are at war and they are the sword of the enemy. But we need brave and patriotic leaders for that…

    • Giaourti Giaourtaki

      No leaders works better, from time to time one needed not a leader but a chieftain of war like Crazy Horse or Nestor Machno but today the one with the laser-pointer for the cocktail-party is leadership enough.