Brussels, 27/02/2012 (Agence Europe) - Despite a general public largely reticent about the idea of continuing to provide Greece with financial support, an extraordinary session of the German Bundestag on Monday 27 February voted through the second Greek bailout, on the basis of an agreement reached last week by the Eurogroup (see EUROPE 10558). It did not vote through a motion refusing any increase to Germany's contribution to the European financial firewall designed to avoid the spread of the sovereign debt crisis to the whole of the eurozone (see other article).
“Europe will fail if the euro fails”, warned German Chancellor Angela Merkel shortly before the vote at the Bundestag, reports AFP. She explained that the Greek programme does “not just” contain austerity measures, it also aims to restore Greece's competitiveness. Aware that it cannot be 100% certain that the prescribed formula will work, the Chancellor described the consequences of Greece leaving the Eurozone as “incalculable” for the economies of the eurozone countries and international partners.
The outcome of the vote at the Bundestag was not in doubt in the sense that the German Social Democrats and Greens have always taken position in favour of Germany's financial solidarity with struggling eurozone countries. But it struggles to hide the doubts of majority German MPs as to Greece's ability to comply with its budgetary and macroeconomic commitments in exchange for financial assistance (€130 billion of public aid + the participation of the private sector in the partial restructuring of Greek debt above €100 billion). Voices opposed to continuing financial support have been raised among Merkel's allies. The most recent was that of German home affairs minister Hans-Peter Friedrich. “I am not talking about excluding Greece from the eurozone, but of managing to create incentives for withdrawal which cannot be turned down”, said the Bavarian Conservative at the weekend, who said that “Greece's chances of getting itself back on track are far greater outside the economic and monetary union”.
On Wednesday 29 February, on the eve of the European Council, the president of the European Commission, José Manuel Barroso, will meet the Greek prime minister, Lucas Papademos, to take stock of the situation in Greece. In the presence of Commissioners Rehn (economic affairs), Hahn (regional policy), Andor (social affairs) and Lewandowski (budget), they will discuss the issues for which the Commission has competence: improving the use of European funds (funding SMEs, motorway concessions, privatisation), the presence of the special taskforce set up to monitor the implementation of the Greek programme and provide technical assistance.
It is worth noting that the Commission's anti-unemployment experts visited Greece on Monday 27 February. They discussed the resources to make available in order to provide a shot in the arm to the employment market in a state in which nearly 47% of young people are unemployed. Noting that Greece has a very low rate of graduates who have studied in another country of the EU, they recommended creating mobility projects to allow Greeks to develop new skills. (MB/SDstag/transl.fl)