Merkel pledges more support for Greece

German Chancellor impressed by reforms in nation whose economic woes threatened stability of Europe’s single currency.

Merkel's visit sought to mark the economic upturn of a nation whose economy has been in the doldrums [Reuters]
Merkel's visit sought to mark the economic upturn of a nation whose economy has been in the doldrums [Reuters]

German Chancellor Angela Merkel has pledged to continue backing Greece, one day after the debt-laden country tapped bond markets for the first time since its international bailout began four years ago.

On a symbolic visit to mark the economic rehabilitation of a nation that over the past four years has threatened the stability of Europe and its single currency, Merkel said Greek reforms were paying off, according to the Reuters news agency.

“We see that Greece is fulfilling its pledges … We will continue to support Greece in the future,” Merkel said in a joint press conference with Greece’s Prime Minister Antonis Samaras.

She added that that Athens was meeting its budget targets, opening the way to discuss further debt relief measures in the months to come.

Germany is the biggest single contributing nation to Greece’s bailouts, which have kept the country afloat since 2010 and saved it from bankruptcy. 

Germany has extended to Athens at least 15bn euros of bilateral rescue loans as part of the bailout.

In a sign that the focus of Greece’s bailout programme is gradually shifting towards less austerity and more growth, Merkel and Samaras met startup businesses and said they would accelerate the creation of a 500m euro fund for small and medium enterprises, sponsored by Greece, the EU and Germany.

Angry Greeks

Hundreds of angry Greeks gathered in an uneventful rally to protest Merkel’s visit in central Athens, a far cry from the tens of thousands which had rallied the last time she arrived in the city back in October 2012.

“We want her out! Raus! And when she goes she should also take the Greek government with her because they betrayed us. They sold us out to Germany,” said Roula Darzakou, a 48-year old housewife. “We want our country back, we don’t want her money.”

More than 7,000 officers were deployed on the streets of Athens to keep watch on the rallies. Athens has seen a number of violent demonstrations in recent years, and public protests were banned in the areas in which she will move.

Her visit caps a watershed week for Greece. Strong investor interest in Athens’ first bond sale in four years is seen as a vindication of the wrenching spending cuts and other austerity measures that Greece has undergone in exchange for the 237bn euro international bailout, according to the Reuters news agency.

Many say the investor appetite underscores growing optimism in the other so-called periphery countries that suffered the most during Europe’s debt crisis.

Yet the human cost of the bailout-imposed measures are painfully visible on the streets of Greece, where thousands of companies have closed shop. Unemployment in January stood at 26.7 percent, near a 27.7 percent record, with about 1.5 million people out of work, but the lowest level in 11 months.

Many here criticised the German Chancellor and the government of engineering the high-profile visit to coincide with Thursday’s bond issue and boost Samaras’s chances before a key European election in May.

Opposition parties and labour unions said they would hold rallies outside the banned zone to protest Merkel’s visit.

Source : Reuters

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