Greek-German relations hit by Second World War reparation demands

Tim Wallace
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Greek efforts to renegotiate its debts has led to an increasingly bitter row with Germany
Greece's relationship with Germany soured dramatically yesterday as the country’s justice minister raised the prospect of seizing German assets as reparations for the damage done by the Nazis in the Second World War.

The two countries are at loggerheads over the renegotiation of Greece’s in­ter­national bailout, and the chances of a successful resolution of the row took another serious blow on the demands.

Nikos Paraskevopoulos’ words echoed those of Prime Minister Alexis Tsipras who said he will “strive to ensure all unfulfilled obligations toward Greece and the Greek people are fulfilled.”

Finance minister Yanis Varoufakis had previously raised the issue of reparations, but in a more diplomatic fashion before relations had dived so far.

Germany argues it has already paid the reparations.

“We should concentrate on current issues and, hopefully what will be a good future,” said German chancellor Angela Merkel’s spokesman.

The Syriza government had hoped to make more progress in cutting Greece’s debts to the EU, the European Central Bank and International Monetary Fund – the so-called Troika.

But so far it has managed only to extend the current programme, which it had been elected to scrap.

Troika officials are visiting Athens to inspect the government’s finances. The next stage of the lengthy bust-up could be over privatisation of state firms. Previous governments had agreed to sell the assets, by Syriza is opposed to the idea.

Analysts increasingly believe Greece is going to leave the Eurozone, and that it may do well outside the currency area.

“We think that the probability of Greece leaving the Eurozone at some point is now higher than 50 per cent,” said Julian Jessop from Capital Economics.

“The precise timing is uncertain, but Greece’s current economic and financial position is unsustainable and, after the initial turmoil, the country would be much better off outside [of it].”