Germany: ‘No’ to debt haircut, ‘yes’ to Troika supervision

The German Finance Minister is opposed to the idea of a Greek debt write-down or haircut

In an announcement released on Thursday, following the maiden meeting between Germany’s Finance Minister Wolfgang Schaeuble and his Greek counterpart Yanis Varoufakis, the German government underlined that Greece’s place is in the Euro zone.

However, the announcement stated that Schaeuble’s stance regarding the Greek debt remains unchanged: The German Finance Minister is opposed to the idea of a Greek debt write-down or “haircut” and believes that the Troika of the country’s creditors, i.e. the European Commission, the ECB and the IMF should continue to supervise the implementation of Greece’s program.

It is reminded that, during yesterday’s meeting in Berlin, Wolfgang Schaeuble said a Greek debt “haircut” is not on the agenda, “it’s off the table”.

“We both agreed that we remain committed to a united Europe. Europe has a difficult journey ahead. There are many problems. The most difficult journey in this process falls to Greece,” was the general statement by Schaeuble to kickoff the press briefing.

He repeated that Greece must reform its tax system and that, although the measures announced by Greece are going in the right direction, corruption must be rooted out.
“We must acknowledge the progress that has been made by Greece,” the German FinMin said, making specific reference to a reduction of unemployment and the fact that Greece posted a primary surplus in 2014.

“However, we agreed to disagree over the steps that Greece must take now,” he said, underlining that the country must continue to work with the IMF, the ECB and the EC.

Schäuble reiterated Berlin’s proposal to offer its expertise, by sending 500 German tax officers to Greece. That offer wasn’t taken up before, but it’s still on the table, he said.