Change of climate in Greco – German relationships

The Greek government appears satisfied with the meetings in the German capital, as it believes the first crucial step towards the normalization of relations between the two countries has been taken, and that it will influence the overall climate against our country.

Samaras assured that whatever has been agreed with the Greek side and its partners, it will be respected. His colleagues say that the package of 11.5 billion euros will be the last to be imposed on the Greek people and especially those who have shouldered the biggest burden until now.

Although much will depend on the Troika report, the government believes that the path to the exit from the euro will be stopped and that by the end of October we will get the next tranche and the extension.

Indicative of good the climate is the fact that after the formal meeting and working dinner, Merkel held a private meeting with prime minister Samaras, which lasted another 40 minutes.

Samaras affirmed that "Greece will remain loyal to its commitments and obligations".

The Greek delegation believes that this was the first major step, not only to restore the credibility of Greece, but also to remove the mistrust between the two countries. They believe that this will help to change the psychology in international markets towards our country.

During the meetings the two sides discussed all issues and Greeks officials presented the views of the Greek side, including the way the recession burdens the deficit in a vicious circle that can only be broken by returning our economy to the path of growth. Naturally, they discussed the issues of privatization and structural changes, where the officials of the German government raised the question as to why the commitments and timelines agreed upon are not being met.

"On our part we showed the resolve that we will take the necessary steps in order to create prospects for our country. The prime minister made it clear that the key issue is the lack of recovery," a PM associate said.

The Greek delegation argued that already in five years of recession, the GDP has fallen by 20% cumulatively and it will continue until 2015, reaching 30%. The government believes that the suffocation from lack of liquidity of the Greek economy must stop, as it leads to further reduction of incomes and worsening of the recession.

They agreed to create a Greek Development Fund, with the participation of a German bank and individuals, in order to provide development resources.

Another issue discussed with the German officials was the tackling of tax evasion. On this issue, secretary of State Yorgos Mavraganis will meet early September with the relevant minister of Switzerland in order to implement an agreement on the taxation of savings, similar to that which has been applied with England and Germany.

Also, Samaras’ adviser Stavros Papastavrou will discuss with German officials the unfreezing of the memorandum previously agreed upon between Papandreou and Merkel. It was also agreed that the German government will provide expertise and help with structural changes and reforms in various sectors, such as health.