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German finance minister warns Greece needs third bailout

by: Anna Federova
  • 21/08/2013
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German finance minister warns Greece needs third bailout
In a surprise statement, Germany's finance minister has admitted Greece will need a third bailout package.

Wolfgang Schaeuble made the comment just weeks before Germany’s national election, despite his colleagues’ attempts to play down this prospect, the Telegraph reports.

Speaking to a campaign audience in north Germany, Schaeuble said: “There will have to be another programme in Greece.”

It is likely that an additional bailout package will anger German voters in the run-up to the election, as it will be an additional burden on eurozone taxpayers.

However, this time it is expected to be much lower than the previous two packages, which together make up €210bn (£179bn). Schaeuble also said there would be no further debt haircut for Athens.

Hours before Schaeuble’s speech, German Chancellor Angela Merkel was quoted in German newspapers refusing to discuss the Greek question until the existing package expires at the end of the year.

A third rescue package has been widely predicted by economists, and German opposition leaders have been accusing Merkel of hiding the truth about Greece.

In the first quarter of this year, Greece’s government debt stood at €305.3bn, or 160.5% of GDP.

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