German poll favours Greek exit

The majority of Germans feel the eurozone would be better off if debt-crippled Greece left it, a poll published in prominent newspaper Bild am Sonntag showed yesterday.

The Emnid poll showed 53% of Germans surveyed thought Greece should return to its former currency, the drachma, while only 34% felt it should keep the euro.

Eurozone ministers hoped to meet today to finalise the second Greek bailout, which must be in place by mid-March to prevent a chaotic default, but the meeting was postponed due to Athens’s reluctance to commit to reforms.

Without the austerity measures, which include cutting holiday bonuses and lowering the minimum wage in a country reeling from its fifth year of recession, the ministers say they cannot approve the €130bn rescue plan.

Eurozone finance ministers told Greece this weekend that it could not go ahead with an agreed deal to restructure privately-held debt until it guaranteed to implement reforms to secure a second financing package from the eurozone and the IMF.

The Emnid poll said 80% of Germans surveyed oppose releasing the rescue package unless Greece implements the reforms.

Meanwhile, France’s finance minister, Francois Baroin, said yesterday that talks were moving “relatively well” on the private sector portion of a Greek bailout, but discussions to cut its debt to 120% of GDP by 2020 were difficult.

“We are moving relatively well on the application of the private sector portion, which is on a voluntary basis,” Mr Baroin said. “We hope not to go too far from the level that would move the Greek debt at around 120%. These are difficult discussions.”

Greece aims to submit a final debt swap offer to its private sector bondholders by Feb 13, a date that Mr Baroin said was the latest to conclude a deal.

Some EU officials said on Friday that eurozone governments may now have to contribute closer to €145bn to the second financing package in order to help recapitalise Greek banks after the bond swap. Investors and some EU officials have suggested that any additional money needed to make Greek debt sustainable could come from the ECB, which holds a portfolio of around €40-€50bn worth of Greek paper. The issue was not discussed at the weekend, however.

— Reuters