Speaking at the German-Hellenic Chamber on July 18 in Athens – with the center of the city shut down to most traffic and protests banned during his day-long visit – German Finance Minister Wolfgang Schaeuble said his country was willing to make investments in Greece.
Germany foots much of the bill for $325 billion in two international bailouts for the strapped Greek economy but has insisted on harsh austerity measures in return. In Athens to meet Prime Minister Antonis Samaras, he said Germany would back a 100 million euro ($130 million) investment fund to help.
“We feel deep respect for the efforts made by Greece, and if you succeed, we will have succeeded as well,” he said.
The German minister appeared confident towards the potential of the Greek businesses, noting that: “Sustainable development depends on businesses that will create jobs.”
He said Greeks should be patient and remember the struggles Germany had before becoming the European Union’s biggest economy. “Ten years ago, we, the Germans, were the weakest link of Europe,” he said. Schaeuble said Greece will regain competitiveness if it sticks to the German recipe of pay cuts, tax hikes and slashed pensions.”
“There is no way around structural and fiscal reforms… There is no convenient shortcut,” Schaeuble said during a press conference at the chamber that was attended by his Greek counterpart Yannis Stournaras and Development Minister Costis Hatzidakis.
Schaeuble urged Greece to give up talk about the need for a fresh debt haircut, rejecting speculation as counterproductive. “We have to stick to what has been agreed. Anything else is not in the best interest of Greece,” he said.
He was referring to a trial balloon floated by the Greek side about sticking public lenders with big losses on the loans as Greece did with private investors. That would mean that taxpayers in other EU countries would have to foot the bill and Greeks could walk away without paying all it owes.
“The things that united Greece and Germany are far more than the things that divide them,” Stournaras said. Hatzidakis announced the creation of an investment fund with German investment bank KfW aimed at boosting growth in the debt-wracked country.
In an interview with Der Handelsblatt, Hatzidakis predicted that 2013 will be the last year of recession for Greece although most analysts disagree.