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Parliament set to back Greek bailout

Updated: 2015-07-18 08:07
By Agencies in Berlin, Germany (China Daily)

OK expected despite misgivings about more aid to Athens; FM suggests 'Grexit' would be better

German lawmakers are expected to give the government their clear backing on Friday to start negotiations on a third bailout program for Greece, despite Finance Minister Wolfgang Schaeuble questioning whether it will succeed.

Lawmakers from Chancellor Angela Merkel's conservatives and her junior coalition partners, the Social Democrats, already voted overwhelmingly in favor of the eurozone opening talks with Athens in test ballots held on Thursday.

These results indicate that Merkel is likely to get the mandate she needs from the Bundestag lower house of parliament, with some opposition parties also expected to vote 'Yes' at the end of the debate.

"The principle ... of responsibility and solidarity that has guided us since the beginning of the European debt crisis marks the entire result from Monday," Merkel told a special session of Parliament.

The positive soundings from lawmakers came despite popular misgivings in Germany about funneling more aid to Athens - reservations deepened by Schaeuble suggesting the better option for Greece may be to take a "timeout" from the eurozone.

"Seven reasons why the Bundestag should vote 'No' today," ran a headline in the mass-selling Bild daily, listing "Grexit is the better solution" and "our grandchildren will pay" among its reasons.

The Greek Parliament approved the new bailout offer in the early hours of Thursday.

The German vote comes a day after European Central Bank chief Mario Draghi boosted a vital cash lifeline to Greece's struggling banks that will allow them to open their doors for the first time in almost three weeks on Monday.

European Union finance ministers also approved 7 billion euros ($7.6 billion) in bridge loans to Greece, allowing it to avoid defaulting on a bond payment to the bank next Monday and clear its arrears with the IMF.

These moves have lowered the risk of "Grexit" - a Greek exit from the euro - for the time being.

With Merkel under domestic pressure from lawmakers who have lost trust in Greece, the country's creditors agreed to a tough deal on the weekend demanding that Athens cut pensions, raise the value-added tax, and set aside 50 billion euros of state assets to sell off.

Germany, the eurozone country that has contributed most to Greece's two bailouts since 2010, secured the terms it had sought. Nevertheless, Schaeuble repeated on Thursday the suggestion he made in the weekend negotiations that Greece might be better off temporarily leaving the eurozone - a view that resonates with some of his fellow conservatives.

Conservative lawmaker Mark Helfrich told Deutschlandfunk radio he would vote 'No', adding: "This is about ruined trust."

In a sign of frustration with Athens, 48 conservatives in Thursday's test vote opposed new negotiations, according to participants.

Reuters - AFP - AP

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