ECONOMY

Merkel casts doubt over Greek rescue

German Chancellor Angela Merkel on Wednesday expressed doubts for the first time that Greece can be saved from a meltdown, given that after two years of financial assistance and brutal austerity measures, the debt-wracked country still appears unable to rally.

Speaking in a interview with the UK’s Guardian and five other leading European newspapers, Merkel described Greece as «a special case,» saying that «despite all the efforts that have been made, neither the Greeks themselves nor the international community have yet managed to stabilize the situation.”

Merkel’s statements come before a crucial European Union summit on Monday, where she aims to push through a «fiscal compact» treaty that will allow for fines to be levied against fiscal sinners, give the European Court of Justice the power to judge the budgets of the 17 members of the common currency and establish legally binding debt ceilings for eurozone governments.

“There would be no point in promising more and more money without tackling the causes of the crisis,» Merkel said. «Amid all the billions in financial assistance and rescue packages, we Germans also need to watch that we don’t run out of steam. After all, our capacities aren’t infinite, and overstretching ourselves wouldn’t help us or the EU as a whole.

“We will only be able to strengthen our common currency if we co-ordinate our policies more closely and are prepared to gradually give up more powers to the EU. If we make loads of promises about debt reduction and sound budgeting, those need to be things that can be enforced or brought to court in the future. The point of the fiscal compact, after all, is to make it possible to check on those commitments. That means giving our [European] institutions more monitoring rights -? and more bite,» the German chancellor added.