Merkel urges private sector to join Greek package

German Chancellor Angela Merkel said on Sunday she was not aiming for a forced restructuring of Greek sovereign debt, but wanted private sector investors to make a major contribution to a voluntary scheme to rescue Greece.

“What we want is as few measures as possible, and a restructuring, as is constantly being mentioned now, also has the negative effect that countries possibly will not make as much of an effort anymore,» German Chancellor Angela Merkel told ARD public broadcaster.

“I am not working towards it. We are trying everything we can to avoid something that is even tougher.

“But I’m saying clearly that the involvement of private creditors shows that we have a special problem in Greece due to the very, very high debts.»

Germany wants private creditors of Greece — banks, insurance funds and other investors — to shoulder some of the burden, preferably as much as 30 billion euros, in bailing out the country for a second time.

But talks between European officials and the private sector over the past three weeks have failed to reach a deal on how they will be involved. Options discussed include a rollover of Greek debt holdings, a swap of existing bonds for new ones, and a buy-back of bonds.

“The more we can involve private creditors now on a voluntary basis, the less likely it is that we will have to take next steps, but we also have to prepare for things. But most important is that Greece does its homework and private creditors have to be involved,» Merkel said.

Merkel, speaking on her 57th birthday, also said she would only travel to Brussels for a special summit of euro zone leaders on Greece this Thursday if lower-ranking officials had already prepared a clear rescue plan for Athens. European Council President Herman Van Rompuy announced the summit on Friday.

“I will only go there if there is a result. Work is still being done,» she said. «I have arranged my schedule so that I have time to go there on Thursday and I believe it is also urgently necessary.»

She also joined the ranks of European policymakers who, criticising the role of credit rating agencies in the euro zone debt crisis, say Europe needs its own agency in the medium term.

“Rating agencies in a sensitive moment…certainly aggravate. They don’t look at all at what is rationally prudential and in this place it is worth considering whether one should believe everything that rating agencies say,» she said.

“When we make programmes, such as now for Greece, we could also say we believe in those programmes and we don’t look every day, is Greece being downgraded or not.”