‘Haircut’ of Greek debt not 
on table

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Greece’s new finance minister has sought to convince his sceptical German counterpart to back a new approach on Greek debt – but an agreement still appears to be a long way off.

Meeting for the first time since the anti-bailout party Syriza took power in Athens, Yanis Varoufakis and Wolfgang Schaeuble held talks in the German capital Berlin about how to move ahead over Greece’s attempts to renegotiate the terms of its debts.

Germany’s Mr Schaeuble said the two “agreed to disagree” and that a writedown, or haircut, of Greece’s debt is not on the table.

Germany is the biggest European contributor to Greece’s five-year bailout programme. It is a staunch proponent of austerity measures which have led to deep income cuts in Greece, record-high unemployment and an economic depression.

Mr Schaeuble renewed offers to help Greece strengthen its tax system and said that some things the new government has announced are a step in the right direction – such as getting the rich to pay tax and combating corruption.

But he added that “some of the measures that have been announced... don’t necessarily go in the right direction”. Mr Schaeuble also said it was important to respect existing agreements, arguing that “reliability is the condition for confidence”.

Mr Varoufakis said Greece would do everything to avoid any default, and said he was confident Athens and its partners would “put the D word out of court”.

He said Athens is looking to a bridging programme to give room for talks on “a new contract” with the European Central Bank (ECB), International Monetary Fund (IMF) and European Union.