Any political turmoil in Greece following this month’s election is no longer a threat to the wider stability of the euro area, said Michael Fuchs, a senior lawmaker from Chancellor Angela Merkel’s party.
“The situation in Europe has changed very much” since the height of the region’s debt crisis, Fuchs said today in an interview with Bloomberg Television. “Systemically they are not relevant any more, the Greek people, so I’m not afraid for any other country.”
Greece’s future in the euro has been thrown into question as opposition party Syriza leads in polls for an election Jan. 25 on a platform of ending the austerity imposed as a condition of the country’s two bailouts. In recent years, European leaders have put in place measures to ward off a new crisis that including emergency funding for European Union member states and a restructuring fund for struggling banks.
Spiegel magazine reported this week that Merkel is ready to accept a Greek exit from the euro. Her government is running scenarios for an exit and possible bank run, newspaper Bild said today.
Fuchs said it’s up to the Greek people and the next government to decide whether the country stays on the path of reforms that have borne fruit and made Greece more competitive, citing the country’s rebounding tourism industry.
“I’m quite sure if somebody is going to cut back on the reforms then definitely we will not pay out any more money to the Greek government,” Fuchs said.
Greece won’t get about 7 billion euros ($8.3 billion) in aid disbursements unless a number of aid program milestones are met. The so-called Troika’s review of Greece’s progress in meeting program targets will continue until as long as the end of February.