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Greece needs a haircut: Hollande advisor

Greece and other southern European states will need new so-called debt "haircuts" or write-offs, Philippe Aghion, an advisor to French President Francois Hollande, said on Wednesday.

Published: 23 May 2012 17:13 CEST

“The countries in the south (of Europe) will need an additional debt haircut. I don’t see how Greece, Spain and Portugal can ever really grow again without a haircut,” Aghion said in an interview with the weekly Die Zeit.

“Banks in southern Europe will need further assistance from the European Central Bank and the stability fund,” he predicted.  

Aghion also called for a reform of the fiscal accord agreed by eurozone states earlier this year.

“If growth this year comes out lower than expected, we’ll need the pact to be more flexible so as to be able to tackle structural reforms,” the economist said.

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ANGELA MERKEL

German war crime payments debated in Greece

Greece's parliament on Wednesday began a debate on a resolution to demand the payment of German war crime reparations, an issue long disputed by Berlin.

Published: 17 April 2019 12:21 CEST
German war crime payments debated in Greece
Angela Merkel and Alexis Tsipras in Greece in January. Photo: DPA

“These demands are always active. They were never set aside by Greece,” parliament chairman Nikos Voutsis told reporters this week.

The chamber is expected to approve later Wednesday, with cross-party support, a resolution calling on the government of Premier Alexis Tsipras “to take all the necessary diplomatic and legal steps to claim and fully satisfy all the demands of the Greek state stemming from World War I and World War II”.

A parliamentary committee last year determined that Germany owes Greece at least €270 billion for World War I damages and looting, atrocities and a forced loan during the Nazi occupation in World War II.

Reclaiming war reparations has been a campaign pledge by Tsipras since 2015. He faces multiple electoral challenges this year, with his party trailing in polls.

'Historical responsibility'

During a visit to Greece in January, German Chancellor Angela Merkel said her country “recognised its historical responsibility.”

SEE ALSO: Merkel says Germany recognizes responsibility for Nazi war crimes in Greece

“We recognize our historical responsibility. We know how much suffering we, as Germany in the time of Nazism, have brought to Greece,” she said.

In 2014, ex-president Joachim Gauck had also sought public forgiveness in the name of Germany from relatives of those murdered by the Nazis in the mountains of northern Greece.

But when it comes to actual payments, the German government has always insisted that the issue was settled in 1960 in a deal with several European governments.

Germany's government spokesman Steffen Seibert reiterated Wednesday that “the reparation issue is judicially and politically settled”. 

He said Berlin is doing “everything it can so Greece and Germany maintain good relations as friends and partners”. 

During the Greek economic crisis, there was further tension in Athens over draconian EU austerity and bailout terms seen to be imposed by Berlin hardliners.

Relations have improved over the last three years after Tsipras' government endorsed conditions linked to satisfying its creditors.

Tsipras and Merkel also worked closely on finding common ground on migration and Balkans security.

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