With Mr. Austerity gone, will Germany approve debt relief for Greece?

05/04/2018

Germany’s new finance minister, Olaf Scholz, is more likely to join a European effort to reduce Greece’s debt, but political dangers abound.

By Martin Greive & Jan Hildebrand
April 3, 2018

France and the European Union are pressing ahead with plans to implement debt relief for Greece now that Germany’s former Finance Minister Wolfgang Schäuble, who preached austerity instead of bailouts, is no longer holding the purse strings in the coalition government.

European finance ministers are scheduled to meet at an informal meeting in Sofia, Bulgaria at the end of the month, and there is growing hope that Germany’s new finance chief, Olaf Scholz, will be more flexible than Mr. Schäuble was in agreeing to debt relief. Greece’s debt-to-GDP ratio has risen from 160 percent at the end of 2012 to almost 180 percent this year and is becoming more untenable than ever.