• Report: Merkel sees no new Greek debt writedown
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     | July 03,2013
     

    BERLIN — German Chancellor Angela Merkel has rejected talk of a new debt writedown for struggling Greece and insisted the country is making good progress.

    Greece received in April last year a first round of debt relief that wiped 100 billion euros ($130 billion) off the sum the government owed to private sector investors, who took heavy losses on bondholdings.

    The possibility of granting Greece a second round of debt relief has frequently been floated. But asked in an interview with Germany’s Sueddeutsche Zeitung and five other European newspapers whether there will be a second writedown, Merkel replied: “I don’t see it.”

    “Greece has moved forward thanks to the very reform-oriented Samaras government,” Merkel said in the comments published Tuesday. “I assume that debt sustainability will continue to be assured.”

    Merkel faces national elections in September and is sticking to her hard-nosed approach to Europe’s debt crisis, with Germany the biggest contributor to rescue funds but also insistent on spending cuts and economic reforms.

    The chancellor also defended Germany’s insistence on making potentially time-consuming changes to the European Union’s basic treaty to complete the bloc’s banking union — a key part of its strategy to combat its financial crisis. Berlin has said, for example, that eventually creating a central authority to wind down failing banks would require treaty changes to have a safe legal basis.

    “We will not get by without further treaty changes over the years, even though we should now do everything that can be done without treaty changes,” Merkel was quoted as saying. “Otherwise it will take too long for anything to happen at all.”

    “We are states of law — our actions must be built on the law and on treaties,” she said.

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