Germany Unaware Of Greek Bailout

Germany’s Finance Ministry yesterday said it was not aware of any agreement by eurozone members to bail out heavily indebted Greece, and the EU’s executive said no such deal had been concluded.

The statements followed a report by Britain’s Guardian newspaper that a multibillion-euro bailout for Greece had been agreed as part of a package to support the euro. The paper quoted a senior European Commission official as saying the 16 eurozone members had agreed on “coordinated bilateral contributions” in the form of loans or loan guarantees if Athens were unable to refinance its debts and called on the EU for help.

Asked whether a deal had been concluded on financial support for Greece, European Commission spokesman Jonathan Todd said: “The Commission stands ready to act if necessary. Technical work is ongoing and has not yet been concluded. All the rest is speculation.”

A German ministry spokesman said he could not believe the newspaper report was correct.

“We are not aware that this is being planned,” he said, adding that Greece had not requested any aid. “Greece is implementing its [savings] program and we expect that it will manage it alone.”

The reports come ahead of a meeting of finance ministers tomorrow, which officials have said would praise Greek austerity efforts and discuss a support mechanism that Athens could use to finance its borrowing needs if necessary. Eurozone policymakers have been debating the issue of possible financial aid for Greece for more than a month, but have so far provided only words of support. Germany, key to any deal, has resisted appeals to promise aid.

The Guardian said agreement on a package had been reached despite strong resistance by Berlin. Berlin had played the pivotal role in organizing the deal, the paper quoted other sources as saying. Eurozone finance ministers will finalize the package tomorrow, the paper said.

The bailout aid could reach 25 billion euros (US$34.4 billion), the paper quoted its sources as saying. Greece’s borrowing needs for the whole of this year total 53.2 billion euros.



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