Austria finance minister says Europe can cope with Grexit


Europe would suffer little economically should Greece leave the euro zone but the consequences for Greece would be considerably worse, Austria's Finance Minister Hans Joerg Schelling said on Saturday.

"For Europe, this would be easy to manage economically. For Greece, it would indeed be considerably more dramatic," Schelling was quoted as saying in an interview with online newspaper Die Presse.

Schelling said Greece would need humanitarian aid in case of "Grexit" but described fears of widespread poverty sweeping Greece as overstated.

"There's a propaganda war going on here. It's exaggerated to think that all the Greeks will have to live in the streets or won't have access to medical care," he said.

Whatever the outcome of Greece's planned referendum on Sunday, the country will need to negotiate a fresh aid program with new conditions, he said.

"A new aid program needs to be started. The old one is dead and can't be extended. And a new aid program takes time. In addition, there can be no new lending without conditions," Schelling said.

On Friday, Greeks took to the streets by the thousands in rival rallies that exposed a deep divide ahead of a referendum called by Prime Minister Alexis Tsipras for Sunday that could determine the country's future within Europe.