German Chancellor Angela Merkel and French President Nicolas Sarkozy came to agreement on a second bailout for debt-troubled Greece with Germany backing down on its stance that private investors must be compelled to share losses. Sarkozy said that there was a need for haste in putting a package together, and said that France and Germany took the same position.
Reuters reported that the two leaders met in Berlin on Friday to discuss involvement of private investors in any rescue package; that has been a large obstacle on the road to an agreement, since ratings agencies regard any such element as an involuntary restructuring and have warned that they will rate Greece accordingly.
Prior to their meeting, German Deputy Foreign Minister Werner Hoyer said in the report, "I believe the meeting today will yield a solution. I am sure that they will come to a compromise." At the end of the discussion, Merkel and Sarkozy together announced their agreement.
The New York Times reported Merkel saying, “We would like to have a participation of private creditors on a voluntary basis. This should be worked out jointly with the E.C.B. There shouldn’t be any dispute with the E.C.B. on this.” Sarkozy termed the change of stance on the part of Germany “a breakthrough.”