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Portfolio > Economy & Markets

Greece Must Stay in Eurozone: Hollande, Merkel

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After meeting with Prime Minister Antonis Samaras of Greece on Saturday, President Francois Hollande of France reiterated that Greece must remain in the eurozone—echoing the words of the German chancellor, Angela Merkel, the day before.

However, Hollande also said that Greece could not push its population too far in the quest to comply with conditions for its bailout, and that Europe must settle on a plan of action as quickly as possible once the troika delivers its report. And Germany and France will form a working group to coordinate proposals.

Reuters reported Saturday that Hollande offered a hint of more flexibility than Merkel, despite their “united front” message. Samaras, who has been conducting a “charm offensive” in the effort to gain extra time for Greece to comply with bailout terms, had met with Merkel on Friday and with Hollande the next day.

The German chancellor, while emphatic that she wanted Greece to remain in the eurozone, was equally firm on the need for Greece to adhere to its present schedule, which Samaras is seeking to extend.

However, Hollande was quoted saying, “[Greece] must demonstrate again the credibility of its program and the will of its leaders to go through with it to the end, while ensuring it’s bearable for the population.”

He added that once the report is in from the so-called troika—the European Central Bank (ECB), European Commission (EC) and International Monetary Fund (IMF)—on Greece’s progress in meeting its commitments, Europe should take fast action.

He was quoted saying, “Once we have this report, once the commitments … are confirmed, Europe has to do what it has to do. We’ve been facing this question for 2½ years. There’s no time to lose—there are commitments to reaffirm on both sides, decisions to take, and the sooner the better. That means after the troika report at the European summit in October.”

While the troika begins its evaluation of Greece’s adherence to the program in early September, AFP reported Monday that it has now said it may not present its report until October. It had originally been scheduled to do so in September. Such a delay would necessarily hold up action by Europe on additional rescue funds for Greece, which would increase the difficulty of the situation.

Hollande also said that Greece’s continued membership in the eurozone should stop being an issue.

The finance ministries of both countries will form a working group, it was announced Monday, to make joint proposals on such issues as fiscal growth and policy and closer fiscal and policy union among countries in the eurozone, as well as to coordinate on decisions by Hollande and Merkel.

Finance Minister Wolfgang Schaeuble of Germany said in the report, “We will start in the next days and weeks a working group between our ministries to prepare forthcoming decisions in bilateral cooperation.”


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