Angela Merkel dedicates extensive sections of her memoir, Freedom, published today, to Greece, focusing primarily on the financial crisis, the country’s role in the migration crisis, and the Prespa Agreement. She also recounts events from the early 1970s when she joined others in calling for the release of Mikis Theodorakis from the Greek junta.
“As my mother knew Greek, she helped me write a letter in Greek calling for his release. One morning, a friend said to me: ‘Mikis betrayed us.’ ‘What happened?’ I asked. ‘He is free, that’s what we wanted, but…’ ‘But?’ ‘He didn’t come to us; he went to the West,'” Merkel writes.
On the Eurozone Crisis
Merkel devotes 35 of the 736 pages in her book to the Eurozone crisis, beginning with the first European Council meeting after it was revealed that Greece’s deficit was 12.7% of GDP, not 3.7%. “The European Commission demanded that Greece reduce its deficit by four percentage points in 2010. (George) Papandreou initially agreed but did not present a plan for how he intended to achieve this. In our phone call, I told (Nicolas) Sarkozy that I couldn’t see what we could do for Greece the next day. I considered a meeting without a clear goal unproductive, as it could create further uncertainty,” she writes.
“(Jean-Claude) Trichet (then head of the ECB) concluded by saying, ‘Greece must be helped now; otherwise, it is not guaranteed that the country will still be able to access capital markets in the spring.’ As the previous day, it was unclear to me what form this help would take. (José Manuel) Barroso shared Trichet’s view, as did Sarkozy. The French President also referenced the Commission’s austerity demands for Greece and angrily exclaimed: ‘Cutting four percentage points of GDP is a surefire way to trigger uprisings in the streets. We need more, not less, public spending. Greece must be helped!'”
Merkel recalls that everyone except her and Papandreou nodded in agreement. However, one of Germany’s key conditions for joining the Eurozone was the “No-Bail-Out” clause, which required each state to be responsible for its own debts. “Everyone in the room knew the legal situation, but no one seemed to care. At first, I said something conciliatory: ‘Of course I want to help; we are a common Eurozone,’ but I immediately added, ‘I cannot give money under any circumstances.’ Noticing Papandreou’s silence, I addressed him directly: ‘What do you actually want?’ He replied that he wanted nothing but said Greece was in dire straits.”
Merkel describes how Trichet insisted that Greece must be helped to prevent risk to other Eurozone countries. However, she remained firm, refusing to violate EU treaties. “Our Federal Constitutional Court had clearly ruled: The Lisbon Treaty’s No-Bail-Out clause applies. I will not knowingly break the law,” she writes. Merkel also recalls thinking: “Everyone here wants something from me. Why is no one pressuring Greece to save money?”
According to Merkel, Papandreou requested time to submit proposals for reducing the deficit. “I found his reaction incomprehensible. On the one hand, there was immense pressure to act, and on the other, he seemed to have all the time in the world,” she notes. Merkel acknowledges the mediating role of European Council President Herman Van Rompuy but expresses concern about the burden her newly formed government in Berlin would face, especially as the issue was not included in the coalition agreement. Additionally, “old fears resurfaced from when Helmut Kohl introduced the euro,” as some doubted that the common currency would ever match the stability of the Deutsche Mark.
Merkel explains that Germany’s approach was bilateral loans combined with IMF assistance, ensuring repayment with interest. “We needed to ensure no country could again report false deficit data to the EU. The competitiveness of certain Eurozone members also had to improve. Our philosophy was: Yes to help, but only tied to measures,” she writes.
The Announcement from Kastellorizo
Merkel recalls 23 April 2010, when it was announced that Greece’s deficit would exceed 15%. “At the time, Prime Minister Papandreou was not in Athens but on the small island of Kastellorizo near the Turkish coast. In bright sunshine, with the picturesque harbour as a backdrop, he announced that he would request assistance from the Eurogroup and the IMF, preparing citizens for a difficult time and speaking of a new odyssey,” she writes. A few days later, Merkel told the Bundestag it was a “last resort” to preserve currency stability.
“Was I right? Were there alternatives we hadn’t considered? Of course, there are always alternatives in life. In extreme terms, even jumping off a roof is an alternative to life. Similarly, allowing the collapse of IKB and HRE banks and the end of the euro would have been alternatives, but not serious ones for Germany, Europe’s largest economy, at the heart of the continent, with over 80 million people,” she reflects. Merkel defends her controversial use of the phrase “no alternative,” which some criticised as authoritarian, arguing that her intention was to convey the gravity of the situation.
Merkel dismisses as “nonsense” claims by Germany’s opposition at the time that she tried to wrap up Greece’s bailout programme before state elections in North Rhine-Westphalia. “Europe’s situation was far too serious for me to consider that. Instead, I was unwilling to help Greece before the country presented a coherent reform programme,” she states.
On the Greek Referendum
Merkel writes about Papandreou’s proposal for a referendum, noting that he struggled to implement promised reforms and, in desperation, decided in October 2011 to let the Greek people vote on the austerity package. However, he abandoned the plan after Barroso, Van Rompuy, Sarkozy, and Merkel made it clear during the G20 summit in Cannes that reforms were inevitable. Papandreou soon resigned, giving way to a caretaker government and later the election of Antonis Samaras.
On Samaras, Merkel notes that he struggled to fully implement the reforms tied to the second bailout programme, leading to Tsipras’s election. She describes her first meeting with Tsipras in 2015, noting his charm but also the immense challenges his government faced in balancing election promises with Eurozone obligations.
On the Prespa Agreement
Merkel commends Tsipras and North Macedonian Prime Minister Zoran Zaev for their “brave and decisive” actions in resolving the name dispute through the Prespa Agreement. She highlights their determination to address a long-standing issue, describing the agreement as a testament to effective leadership and compromise.
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Source: ANA-MPA
