Merkel pledges no new haircut

Julian Harris
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GERMAN Chancellor Angela Merkel yesterday lashed out at the idea that Greece could be granted another haircut on its debts, while playing down the prospect of a third bailout for the indebted Mediterranean state.

Merkel was speaking in Germany on the day that the European Central Bank (ECB) visited Athens to check up on Greece’s bailout progress. The ECB’s trip was overshadowed by leaders from Brussels and Germany seeking to play down fears that the troubled Mediterranean state could need a third rescue package.

German finance minister Wolfgang Schauble had, on Tuesday, suggested that another rescue package for Greece may be in the pipeline. But yesterday his boss insisted that no new bailout could be agreed until mid-2014. “I will prevent this with all my might,” Merkel added, referring to the prospect of a further haircut.

Meanwhile in Athens, senior ECB official Joerg Asmussen insisted that a new bailout had not been discussed: “We have focused on making the current programme a success.”

Earlier in the day the EU’s economic and monetary commissioner, Olli Rehn, said that Greece could be helped by extending the loan periods in its existing bailout agreement. Yet he could not rule out a third bailout.