Under a plan hammered out

Greece to exit eurozone

GMT 04:55 2012 Sunday ,26 February

Arab Today, arab today Greece to exit eurozone

German Interior Minister Hans-Peter Friedrich
Berlin - AFP

German Interior Minister Hans-Peter Friedrich Berlin - AFP Germany's interior minister on Saturday came out strongly in favour of debt-stricken Greece leaving the eurozone, arguing that this would would improve its chances of becoming competitive again. "I do not mean that Greece should be kicked out of" the 17-nation eurozone, said Hans-Peter Friedrich in an interview with news magazine Der Spiegel, "but to create incentives for an exit that they cannot turn down." "Outside European monetary union Greece's chances of regenerating itself and become competitive are definitely bigger than if it remained inside the eurozone," said Friedrich. Friedrich was speaking ahead of a vote by German lawmakers on Monday on a further 130 billion euros ($175 billion) in loans for Greece. Under a plan hammered out by eurozone finance ministers, Greece would receive up to 130 billion euros in direct loans by 2014 in return for tough new austerity measures and tighter EU-IMF oversight of its economy. A private creditor bond writedown is worth another 107 billion euros. Germany is the biggest contributor to eurozone bailouts. The latest plan for Greece would be financed via the European Financial Stability Facility and does not involve stumping up new funds. Chancellor Angela Merkel is opposed to Greece leaving the eurozone despite its huge debt burden and expects parliament to give the green light to the latest rescue package. She agreed in January, along with French President Nicolas Sarkozy, to keep Greece inside the eurozone for as long as Athens imposes stringent budget reforms.  

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