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Germany's Merkel to visit Greece next week

By Geir Moulson

Associated Press

Published: Friday, Oct. 5 2012 6:05 a.m. MDT

FILE - In this Aug. 24 2012 file picture German Chancellor Angela Merkel, left, talks to Prime Minister of Greece Antonis Samaras, during a welcome ceremony at the chancellery in Berlin, Germany. Germany's Chancellor Angela Merkel is to visit Greece next week as Athens works to convince its creditors to pay the next installment of its bailout package. Merkel's spokesman, Steffen Seibert, said the chancellor will meet Prime Minister Antonis Samaras in Athens on Tuesday. Seibert said Friday Oct. 5, 2012 that Merkel's visit follows an invitation that Samaras made when he visited Berlin in August.

Maja Hitij, AP Photo/dapd

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BERLIN — German Chancellor Angela Merkel will travel to Greece next week for the first time since the debt crisis erupted to meet the country's prime minister — who warned Friday that Athens will run out of money at the end of November if it doesn't receive the next part of its bailout loans.

Because Germany has been instrumental in pushing Greece to make austerity cuts in exchange for its bailout loans, Merkel has routinely been the object of anger at public protests in Athens. Her photograph has been manipulated by Greek newspapers to look like a Nazi officer and a prisoner at Guantanamo Bay.

Merkel's spokesman, Steffen Seibert, was at pains on Friday to portray next week's trip as "a normal visit."

He underlined Germany's message that it wants Greece to stay in the euro bloc — but that the Greeks also must push ahead with their painful reforms. Since Greece received its first bailout in May 2010, it has repeatedly slashed incomes, hiked taxes and raised retirement ages.

Merkel's visit Tuesday follows an invitation that Prime Minister Antonis Samaras made when he visited Berlin in August. It wasn't immediately clear whether she will meet anyone else on her first visit to Greece since July 2007.

"We want to help Greece to stabilize itself in the eurozone. We are doing that by contributing massively to the rescue programs that are supposed to help get Greece out of the crisis," Seibert said. "This will only be possible with major efforts on the part of the Greeks — we see that there is increased reforming zeal under the Samaras government and we want to support that."

Merkel has been noncommittal on Greece's hopes of getting more time to enact reforms and repay its loans, but has rejected talk from some in her center-right coalition about a possible Greek exit from the 17-nation euro.

Greek government spokesman Simos Kedikoglou said that "this visit is very positive for the strengthening of traditional ties between the two countries and will certainly be another important step towards future European decisions."

Officials from the European Commission, International Monetary Fund and European Central Bank — the so-called "troika" — are currently in Greece assessing the country's progress in fulfilling the terms for receiving aid.

If their report doesn't clear the way for the payment of the next €31 billion ($40 billion) tranche of the country's bailout, Greece could be forced to default on its debts and perhaps leave the euro. It's unclear when a decision will come.

Asked in an interview with German business daily Handelsblatt how long Greece can hold out without that payment, Samaras was quoted as saying: "Until the end of November. Then the till will be empty."

Samaras said Greece is pressing ahead with budget consolidation, working on speeding up privatization and trying to attract foreign investors. But he conceded that there are difficulties in negotiations with the troika.

"The troika is demanding above all further cuts to pensions and wages. That is very difficult, because we are already bleeding," he said. "The existing cuts already go to the bone. We are at the limit of what we can expect of our population."

The conservative Samaras leads a three-party coalition government that was put together after two elections earlier this year.

"People know that this government means Greece's last chance," the prime minister was quoted as saying. "We will make it. If we fail, chaos awaits us."

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Derek Gatopoulos in Athens contributed to this report.

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