During her press briefing Monday on morning (13 July), German Chancellor Angela Merkel said that trust in the Greek government has been restored.
After the marathon eurozone summit which began Sunday afternoon, Greece was promised a bailout deal worth up to €86 billion if Prime Minister Alexis Tsipras implements tough reforms.
Under the agreement, Greece will also have to set up a €50 billion fund for privatisation of Greek assets. The money will be used to recapitalise Greece’s cash-depleted banks that have been closed for more than a week.
“Greece’s government has shown readiness to carry out reforms. We now have the trust in Greece’s government which was lost over the past months,” the Chancellor said, adding that she expects Athens to stay on schedule before a vote in the Greek parliament, which will take place by Wednesday (15 July) on the bailout proposal.
Merkel was referring to months of tensions between Athens and its creditors, the International Monetary Fund (IMF), the European Central Bank (ECB) and the EU. Greece’s leftist government rolled back a number of reform measures agreed to under the country’s second bailout programme, which began in 2012.
The Chancellor said that in spite of the referendum, the past few weeks have shown that Greeks want to remain part of the “European family.”
Merkel said that a ‘Grexit’ was never discussed. However, many commentators speculated on Sunday that Greece would be given a proposal that would be unacceptable to Tsipras, and that Greece would be forced to leave the eurozone anyway.
Greece’s third bailout programme, including the new asset fund, is in line with previous programmes which other member states, such as Spain and Ireland, have been given over the past years, Merkel said.
Apart from parliamentary approval of reforms over the next two days days, Greece also needs to repay the ECB and the IMF around €7 billion by Monday (20 July). Merkel explained that the the Eurogroup will determine how this will be repayed later today.
Asked about tensions in the eurozone, and reports of a Franco-German split, the Chancellor said she had spent many hours with French President François Hollande and Council President Donald Tusk. “We have different interests, but we stuck together,” Merkel stated.