Spain pressures Greece to keep promises in debt crisis

Spain raised the pressure on Greece Monday to “honour its commitments” to its European partners to end its debt crisis and prevent its dropping out of the eurozone.

“I do not want Greece to leave the euro. I do not believe that would be good for Greece or for Europeans in general,” said Spanish Prime Minister Mariano Rajoy in a radio interview.

“Right now what I would like is for Greece to honour its commitments like we others are all doing.”

Greek Defence Minister Panos Kammenos warned in an interview published on Saturday of a potential “domino effect” if Greece left the eurozone.

“If Greece explodes, Spain and Italy will be next, and eventually Germany,” he was quoted as saying by German newspaper Bild.

That echoed warnings by economists at the height of the eurozone crisis in mid-2012, when Rajoy’s government came close to seeking a full sovereign bailout as Greece had in 2010.

“Spain has got over the worst,” Rajoy insisted on Monday.

He pointed out that interest rates on Spain’s sovereign debt are at record-low levels — a key sign of financial stability.

Greece on the other hand is shut out of financial markets as it fights to stabilise its public finances.

Greece’s radical left-wing Prime Minister Alexis Tsipras came to power in January promising to soften the austerity measures which were imposed as conditions for Greece’s bailout.

In February his government secured a four-month extension of its bailout, but European authorities are withholding the next 7.2 billion-euro payment until Greece passes new reforms.

“We are in a position to keep helping Greece but Greece also has to help itself,” Rajoy said.

“Greece cannot say: ‘Give me the money, and I’ll do what I think best with it.’ It has to do the same as everyone else.”

The Greek defence minister on Saturday also accused German Finance Minister Wolfgang Schaeuble of waging “psychological warfare” against Athens by criticising it during the fraught debt negotiations.

“Not only is that not true, it makes absolutely no sense,” Rajoy said. “Now they are having a go at Germany, which I think is a mistake.”


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