ECONOMY

ECB’s Weidmann says would be tragic if Greece gave up reform drive

Germany’s Bundesbank chief, Jens Weidmann, said on Wednesday Greece was still far from the end of its «marathon» reform process and that it would be «tragic» if Athens gave up the economic adjustments it has already made.

The latest debate around Greece showed the euro zone crisis had unfortunately not been overcome, Weidmann, who sits on the European Central Bank’s policymaking Governing Council, said in the text of a speech for delivery in Munich.

“Those who blame the ECB and European politics for the economic weakness in the crisis countries confuse cause and effect,» Weidmann said, adding that reform measures were starting to work in these countries.

“It would, therefore, be tragic if Greece were to give up its adjustment process now and give away what it has achieved.» «But it is also clear: the economic adjustment process is more like a marathon than a sprint. The second half is well known to be harder than the first in a marathon, and the finish line is still a long way from being reached.”

The reforms Greece needs to pursue to unlock aid are deeply sensitive for Greek Prime Minister Alexis Tsipras.

He came to power in January pledging to end austerity policies but was forced to accept an extension to a hated bailout program under the threat of a banking collapse. Greece failed in a bid on Wednesday to secure a quick cash payment from the euro zone rescue fund to help stave off potential bankruptcy next month, raising pressure on Athens to deliver a convincing reform program within days.

[Reuters]