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  • Jun 22nd, 2018
  • Comments Off on Germany pockets 2.9 billion euros from Greece bailouts
Germany has earned some 2.9 billion euros ($3.5 billion) since 2010 on Greek debt bought to help the struggling country, a government report seen by AFP showed Thursday. "Contrary to all the rightwing myths, Germany profited massively from the crisis in Greece," said Sven-Christian Kindler, a Greens party MP whose question to the finance ministry uncovered the figure.

"It cannot be the case that the federal government is cleaning up the German budget with billions of interest earnings from Greece," he added. The finance ministry document shows the Bundesbank (German central bank) had by the end of last year earned 3.4 billion euros of interest on Greek bonds it bought in 2010-11. Officials at the Frankfurt institution bought Greek debt under a scheme known as the Securities Markets Programme, created by the European Central Bank (ECB) to calm financial markets in troubled eurozone economies.

At a February 2012 Eurogroup meeting, eurozone finance ministers agreed that interest on those bonds should be paid back to Athens via the single currency area's crisis firefighter, the European Stability Mechanism (ESM).

The Bundesbank duly sent 527 million euros to Greece in 2013. But a 2014 tranche of 387 million euros was held by the ESM, part of a 1.8 billion-euro total earmarked to cover some Greek debt payments in exchange for the government pressing ahead with reforms demanded by its creditors.

That reciprocal arrangement ended in June 2015, when the Eurogroup suspended the transfers during a standoff with Greek Prime Minister Alexis Tsipras.

Taking all the twists and turns into account, Germany's federal government has raked in 2.5 billion euros of profit on Greek debt, while public investment bank KfW has notched up 400 million euros of interest payments on a loan to Athens - a total of 2.9 billion euros.

Copyright Agence France-Presse, 2018


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