Germany needs no extra budget for Greek aid: finance minister

BERLIN (BestGrowthStock) – Germany will not need a supplementary budget to pay for an aid package to Greece, Finance Minister Wolfgang Schaeuble was quoted as saying on Saturday, adding he did not expect German taxpayers to suffer.

Greece is moving closer to activating an emergency aid package by seeking to clarify details of how help from euro zone states and the International Monetary Fund would work if needed.

Germany long resisted pressure to agree to a bailout deal, partly due to fierce public hostility, but last weekend euro zone finance ministers hammered out a package which could be used if necessary.

“The risk (that tax payers will have to pick up the bill) is manageable,” Schaeuble told Der Spiegel magazine.

“The package will be made up of credit from the (state owned development bank) KfW which the federal government will guarantee. We do not need a supplementary budget for that. But we will introduce a law which the Bundestag (lower house of parliament) will decide on,” said Schaeuble.

There was no sign that other countries would need financial aid, he added.

However, Schaeuble reiterated his call for tougher euro zone rules to help tackle such situations in future and welcomed steps taken in this direction by the European Commission.

“If we need procedures for cases similar to Greece, we must also talk about the question of how we can include creditors in the costs. With company bankruptcies, creditors have to give up some of their demands and that is how it should be for state bankruptcies,” Schaeuble told the magazine.

He also reiterated his view that EU treaties would have to be changed and that it might be best for states with big debts to leave the currency union.

Schaeuble denied suggestions that Berlin had caved in to pressure over Greece, saying Germany was ready to do what was needed and at the right time.

“A bankruptcy of country would have consequences that we cannot calculate. Greece is just as system relevant as a big bank,” he told Spiegel.

Schaeuble, who is not attending a meeting European finance ministers in Madrid, said he hoped to be out of the clinic in which he was receiving treatment for an unhealed wound, soon.

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(Reporting by Madeline Chambers; Editing by Toby Chopra)

Germany needs no extra budget for Greek aid: finance minister