BERLIN — Lawmakers in Germany’s lower house of Parliament easily passed the next round of financial support for Greece on Friday, despite growing doubt among members of Chancellor Angela Merkel’s coalition and opposition parties that the measures will be sufficient to resolve the Greek problem.
As expected, a clear majority of 473 out of 584 lawmakers casting ballots voted in favor of the package of measures agreed to by European finance ministers and international lenders last week that will unlock loan installments totaling €43.7 billion, or $56.7 billion. One hundred lawmakers voted against the measure and 11 abstained.
Germany is one of Greece’s largest creditors and support from Berlin is crucial for the success of the program. Yet with a parliamentary election scheduled for Sept. 22, German politicians from all sides have been reluctant to take on extra financial burdens.
Wolfgang Schäuble, Germany’s finance minister, defended the latest bailout package and praised the restructuring efforts that have been made by the government of Antonis Samaras, prime minister of Greece. But he warned that the current discussion of writing down Greek debt would sap Athens’s drive to continue with the painful course of reforms that Germany has required in exchange for more financial assistance.
“If we say that the debt will be forgiven, then the readiness to save in exchange for further help is weakened. Consequently, this is the false incentive,” Mr. Schäuble said. “If we want to help Greece along this difficult path, then we must go forward step by step.”
The current package aims to cut Greek debt, currently estimated at 175 percent of gross domestic product, down to 124 percent by 2020. Mr. Schäuble acknowledged for the first time that the bailout would cut into Germany’s federal budget, but warned that failure to approve it could be disastrous for the nation and the rest of Europe.
Already the 17 European Union nations using the common currency are in recession. Unemployment in the bloc has also climbed to 11.7 percent, its highest rate since 1995, according to official European figures released Friday.
While the German economy remained largely immune to the suffering on its borders, the most recent official figures show growth slowing and investor confidence dipping.
Against this backdrop, Ms. Merkel has been able to quell calls from within own her center-right coalition for Greece to leave the euro zone, by insisting that the consequences of such a step would be far more dire for Germany than providing more financial assistance.
Ms. Merkel’s government rests on an alliance of her own conservative Christian Democratic Union with the sister party for the state of Bavaria, the Christian Social Union, and the liberal pro-business Free Democrats. It was not immediately clear if a fully majority of her government had supported the bailout measure.
The leading opposition parties, the Social Democrats and the Greens, criticized Ms. Merkel’s government for taking too long to agree to help Greece and for failing to level with German taxpayers about the true cost of the effort, but nevertheless backed the package.
“We will vote for it because we don’t want our reliability as European partners left in any doubt,” Ms. Merkel’s main challenger for the election, Peer Steinbrück of the Social Democrats, told German public television ahead of Friday’s vote. “It has nothing to do with the government.”
Article source: http://www.nytimes.com/2012/12/01/business/global/german-finance-minister-urges-lawmakers-to-approve-greek-debt-deal.html?partner=rss&emc=rss
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