Today's Coming Crisis Movie

Friday, August 24, 2012

Angela Merkel rejects Greek pleas for extra two years to repay loans

Angela Merkel has rejected pleas from her Greek counterpart for a two-year repayment extension after receiving backing from the French president, François Hollande, for her hardline stance.

The German chancellor said it was up to the people of Greece to show they can implement austerity measures agreed with Brussels and the International Monetary Fund (IMF) before there could be any further discussion about the latest €130bn (£103bn) debt package.

But she softened the blow with a commitment to wait for a report next month on the progress by Athens to cut government spending and implement far reaching tax and labour market reforms. She said Greece should stay in the euro "and that's what I'm working for."

The uncertainty surrounding the eventual outcome of talks between Antonio Samaras, the Greek prime minister, and the troika of representatives from the IMF, Brussels and the European Central Bank unsettled markets before the bank holiday.

Reports that the Spanish prime minister, Mariano Rajoy, had conducted talks in Brussels over a possible bailout package were denied by all sides, but added to the uncertainty surrounding the euro. Read More