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German and Greek media are at daggers dawn again

16 November 2010 / 17:11:24  GRReporter
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This time the reason was Prime Minister George Papandreou, who attacked Angela Merkel's proposal private investors and banks to also bear the burden of Greek economy rescue. In an article entitled The Greeks accuse Berlin of its economic stagnation the Spiegel-online states that Papandreou’s verbal attack to Germany recalls the February dispute between the two countries when the financial situation of Greece was getting increasingly worse.  

George Papandreou condemned yesterday from Paris Germany's position and its proposal for the participation of banks and private investors in the support mechanism for member countries of the euro area and warned that this could cause a country to fail. Mr. Papandreou stressed that according to the German government banks that grant state loans at very high interest rates should be ready to bear the cost of a possible default ... This position caused the rise in lending rates to countries in difficulty as Ireland and Portugal. This could lead to a self-fulfilling prophecy ... It's like telling someone in difficult situation that you will increase the load he must lift. He also added that governments will have to oppose the lack of democratic control of financial markets. He compared such a possible confrontation with ‘battle of civilizations.’

In an interview with the French daily Le Figaro today the Greek Prime Minister once again put an end to scenarios for government debt rescheduling. "This scenario is not even a topic of discussion. One such opportunity would be disastrous for the citizens of Greece, given the sacrifices that they agreed to do," said George Papandreou, adding that "this possibility will be also disastrous for the confidence in Europe and its currency." "We continue in the same direction. We denied all who thought Greece wouldn’t be able to settle its accounts. Our efforts continue," said the Greek Prime Minister.  

At the same time the congress of the Christian Democratic Union re-elected Angela Merkel as its leader with 90.5 percent of the votes. The German Chancellor said from its forum that the support mechanism for Greece was approved by the Bundestag, "despite the opposition from all opposition parties." Moreover, she accused her predecessor, Gerhard Schröder and the Finance Minister in his government Ayhel Hans for taking the "political decision" to join Greece to the euro in 2000. "Political decisions are important, but they are irresponsible when they are not consistent with the facts," said the Chancellor of Germany. "Everything is under threat: if the euro fails, and Europe will fail. Our mission is to establish a new tradition on financial stability in the EU," said the Christian Democrats leader.

In response to criticisms of other EU member states regarding the management of the Greek debt crisis, Merkel said that "good Europeans are not always those who act quickly but those who act reasonably." The Chancellor of Germany called on European countries to eliminate threats to the Euro and to create together a new ‘anchor’ for financial and economic stability in the euro area so as to avoid new crisis of confidence similar to that Greece has suffered.

Tags: Economic crisisRescue plan for GreeceGermanyMerkelPapandreou
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