Tags: European | Officials | Deny | Greek | Euro | Exit | Report

European Officials Deny Greek Euro Exit Report

Friday, 06 May 2011 01:45 PM

Greek and European officials denied on Friday that Greece was considering whether to leave the euro zone, after Germany's Spiegel Online reported Athens had raised the idea.

"The government has raised the possibility of leaving the euro zone and reintroducing its own currency," Spiegel said, without citing its sources.

The magazine said euro zone finance ministers were meeting in strict secrecy in Luxembourg on Friday evening to discuss Greece, and that a possible restructuring of its debt as well as the issue of leaving the 17-member bloc were on the agenda.

Greece's Deputy Finance Minister Filippos Sachinidis denied the report, suggesting it played into the hands of currency traders. The euro fell slightly against the dollar in response to the report before recovering most of its losses.

"The report about Greece leaving the euro zone is untrue," Sachinidis told Reuters. "Such reports undermine Greece and the euro and serve market speculation games."

Jean-Claude Juncker, head of the group of euro zone finance ministers, also said the report was wrong. "I totally deny that there is a meeting, these reports are totally wrong," Juncker's spokesman, Guy Schuller, told Reuters by telephone.

But two European official sources told Reuters that a meeting of some European Union ministers was in fact underway in Luxembourg.

The other source said the ministers were reviewing a range of issues such as the economic situations of Portugal and Greece as well as the future leadership of the European Central Bank leadership.

He said there were no plans for a restructuring of Greece's 327 billion euro ($470 billion) sovereign debt. Last May, the country obtained a 110 billion euro bailout from the European Union and the International Monetary Fund, but it has been struggling to cut its budget deficit as fast as planned amid a deep recession.

A German government official told Reuters that a Greek exit from the euro zone "is not planned and was not planned," while a spokesman for the Austrian finance ministry said a breakup of the bloc would be "absolutely unthinkable."

Spiegel quoted from what it said was an internal German finance ministry paper that German Finance Minister Wolfgang Schaeuble was taking with him to Luxembourg, which warned that a Greek exit "would lead to a significant depreciation of the domestic currency versus the euro" and increase Greece's debt levels to 200 percent of gross domestic product.

© 2017 Thomson/Reuters. All rights reserved.

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Greek and European officials denied on Friday that Greece was considering whether to leave the euro zone, after Germany's Spiegel Online reported Athens had raised the idea. The government has raised the possibility of leaving the euro zone and reintroducing its own...
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