Merkel says Germany open to Greek aid though not at any cost

Merkel says Germany open to Greek aid though not at any cost

Chancellor Angela Merkel said Germany remains open to resuming negotiations with Greece on financial assistance, though she won’t agree to a deal at any price.

“The door for talks with Greece was always open and always remains open,” Merkel said in a speech to lawmakers in the lower house of parliament in Berlin on Wednesday. “We owe that to the people and we owe it to Europe.”

At the same time, Merkel and Vice Chancellor Sigmar Gabriel sent a message to Greek Prime Minister Alexis Tsipras that he has to meet conditions to win the release of further aid and that Greece doesn’t have the power to cause an “economic catastrophe” in Europe.

“Yes, these are turbulent days and indeed a lot is at stake,” Merkel said. “The world is looking at us. But the future of Europe is not at stake. The future of Europe would be at stake if we forgot who we are and what makes us strong: A union based on the rule of law and responsibility. If we were to forget that, the euro would fail and Europe with it.”

Merkel, who has backed euro-area bailouts since Europe’s debt crisis spread from Greece in 2010, said bigger matters are at stake than haggling over aid payouts to Greece.

“I want Europe to emerge from this crisis stronger than at the start so we can be strong in competition with China, India, South America,” she said. “That’s what it’s about, not whether a dispute over 400 million or 1.5 or 2 billion euros can be resolved or not.”

Gabriel, whose Social Democratic Party is Merkel’s junior coalition ally, said the euro “isn’t under threat” from the Greek crisis. Tsipras can’t expect aid without an agreement on economic-policy changes, he said.While Greece has the right to hold its planned referendum on July 5, the other 18 euro-area member states have the right to take positions that reflect their interests, Merkel said.

“Being a good European doesn’t mean seeking an agreement at any price,” she said.

No new negotiations can take place before the referendum, since Germany’s lower house, or Bundestag, must vote on opening any aid talks according to the rules of the European Stability Mechanism, Merkel said. [Bloomberg]