ECONOMY

Schaeuble Greek exit idea gets qualified nod from Merkel deputy

schaeuble-greek-exit-idea-gets-qualified-nod-from-merkel-deputy

The idea of a temporary Greek exit from the euro, reprised Saturday by Germany’s Finance Ministry, won qualified support from Chancellor Angela Merkel’s deputy, signaling broader acceptance for such a step within her government.

Vice Chancellor Sigmar Gabriel, the chairman of Merkel’s Social Democratic coalition partner, said Finance Minister Wolfgang Schaeuble’s plan for a five-year “time out” for Greece outside the euro was “known to the SPD.”

“In a difficult situation such as this, every conceivable proposal must be examined without prejudice,” Gabriel wrote early Sunday on his official Facebook page. “This proposal would only be achievable if the Greek government itself views it as the better alternative.”

Merkel’s Chancellery declined to comment on the plan, though Deutsche Presse Agentur on Saturday reported that everything Schaeuble negotiates with the euro-area finance ministers is signed off by Merkel. Deutsche Presse Agentur didn’t cite how it got its information.

First reported by Frankfurter Allgemeine Sonntagszeitung, the one-page position paper deemed Greece’s efforts toward a new bailout insufficient and presented two scenarios: either Greece quickly present a more robust plan and agree to more stringent oversight, or euro-area nations would provide assistance during a five-year suspension outside the single currency.

The plan was dismissed by an EU official in Brussels as legally unfeasible and not serious. The official, speaking anonymously, called for a serious discussion and solutions, not for recycling academic, non-practical ideas.

The German paper was discussed at a lower level and wasn’t presented to the 19 finance ministers, who didn’t discuss a Greek-exit scenario.

[Bloomberg]