Merkel tells irate Greeks painful reforms will pay off

ATHENS Tue Oct 9, 2012 1:13pm EDT

1 of 11. A protester throws a burning cardboard box during a violent protest against the visit of Germany's Chancellor Angela Merkel, in Athens October 9, 2012. Germany's Angela Merkel arrived in Greece on her first visit since Europe's debt crisis erupted here three years ago, braving protests to deliver a message of support - but no new money - to a nation hammered by recession and fighting to stay in the euro.

Credit: Reuters/Yannis Behrakis

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ATHENS (Reuters) - Tens of thousands of angry Greek protesters filled the streets of Athens on Tuesday to greet German Chancellor Angela Merkel, who offered sympathy but no promise of further aid.

Police fired teargas and stun grenades to hold back crowds chanting anti-austerity slogans and waving Nazi flags while Merkel's host, Prime Minister Antonis Samaras, welcomed her as a "friend" of Greece.

On her first visit to Greece since the euro zone crisis erupted three years ago, Merkel struck a conciliatory tone.

She reaffirmed Berlin's commitment to keep the debt-crippled Greek state inside Europe's single currency but offered Samaras no concrete relief ahead of a new report on Greece's reform progress due by next month.

"I have come here today in full knowledge that the period Greece is living through right now is an extremely difficult one for the Greeks and many people are suffering," Merkel said at a news conference with Samaras just a few hundred yards from the mayhem on Syntagma Square, outside parliament.

"Precisely for that reason I want to say that much of the path is already behind us," she added.

Samaras, who invited Merkel to Greece during a visit to Berlin in August, promised to press on with economic reforms necessary to restore confidence.

"The Greek people are bleeding but are determined to stay in the euro," he said. "They are not asking for more money or favors. They only want to get back on their feet as soon as possible and exit this recession."

On the other side of the parliament building, tens of thousands of demonstrators defied a ban and gathered to voice their displeasure with the German leader, whom many blame for forcing painful cuts on Greece in exchange for two EU-IMF bailout packages worth over 200 billion euros ($260 billion).

Greek riot police clashed with protesters who tried to break through a metal barrier to reach the cordoned-off area where Merkel and Samaras were meeting. Some demonstrators pelted police with rocks, bottles and sticks.

At least 30 people were hurt or suffered breathing problems from tear gas and about 300 were detained, police said.

Four people dressed in World War Two-era German military uniforms and riding on a small jeep, waved black-white-and-red swastika flags and raised their hands in the Hitler salute.

Banners read "Merkel out, Greece is not your colony" and "This is not a European Union, it's slavery".

"We know that she is not here to offer favours but she must help us, this is our last chance," said 45-year-old Mari Hanioti, a saleswoman supporting her two children and her unemployed husband.

"She must be able to see what we are going through, how much we are suffering. She should see the poor neighborhoods not just the expensive hotels."

Some 6,000 police officers were deployed for the six-hour visit, including anti-terrorist units and rooftop snipers. German sites in the Greek capital, including the embassy and Goethe Institute, were under special protection.

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For graphic on Greece vs Germany economic comparison click on: link.reuters.com/syw88s

For an interactive timeline on austerity protests click on link.reuters.com/pys56s

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Before departing, Merkel met Greek business people to ask how reforms were progressing and hear how they were affected by an economy that has shrunk by a fifth in five years, leaving 25 percent of workers out of a job.

"She said: talk to me as if I wasn't a leader but a good reporter," one attendant said on condition of anonymity.

Merkel decided to come to show support for Samaras, a fellow conservative, as he struggles to convince reluctant, leftist coalition partners to impose more austerity on a society fraying at the edges after several rounds of cuts.

With a year to go until Germany holds a parliamentary election, Merkel also hoped to neutralize opposition criticism at home that she has neglected Greece and contributed to its woes by insisting on crushing budget cuts.

After her government flirted earlier this year with the idea of allowing Greece to exit the euro zone, she now appears determined to keep it in - at least until the German election is out of the way.

Greece is in talks with its "troika" of lenders - the European Union, European Central Bank and International Monetary Fund - on the next tranche of a 130-billion-euro ($170-billion) loan package, its second bailout since 2010.

Without the 31.5-billion-euro tranche, Greece says it will run out of money by the end of November.

Merkel said the aid payment was "urgently needed" but stopped short of promising that the funds would flow.

"The troika report will come when it is ready. Being thorough is more important than being quick," Merkel said.

Ties between Germany and Greece run deep. Thousands of Greeks came to Germany after World War Two as "guest workers" to help rebuild the shattered country and more than 300,000 Greeks currently reside there.

But the relationship is clouded by atrocities Greeks suffered at the hands of the Nazis. Samaras's own great grandmother killed herself after Nazi tanks rolled down the streets of Athens and the swastika flew over the Acropolis.

Greek President Karolos Papoulias, whom Merkel also met on Tuesday, fought against the Germans as a teenager, before fleeing to escape persecution by the Greek military dictatorship and finding refuge in Germany.

(Additional reporting by Harry Papachristou, Renee Maltezou, Daphne Papadopoulou and Dina Kyriakidou; Writing by Noah Barkin and Matt Robinson; Editing by Giles Elgood)

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Comments (3)
GlennatAOL wrote:
Those freaking Germans! Who do they think they are? They give us billions and billions of euro’s, and they ask that we reduce our budget? Who do they think they are?!
We should be able to spend all the money we want, and they need to keep giving us money! It’s what’s fair!

Oct 09, 2012 1:32pm EDT  --  Report as abuse
DeanMJackson wrote:
Since it wasn’t “reforms” that caused the Euro crisis, Merkel knows that “reforms” are not the answer, and in fact, “reforms” have nothing to do with the science of economics, and are only espoused by politicians and their hack economists.

For growth to resume throughout the EU (and the United States), interest rates need to rise, and rise to their true market-oriented rates, not contrived rates “set” by the European Central Bank.

With low interest rates there can be no reason for investment, since the expected return on investment is (1) low; and (2) the true price level is not known, because massive amounts of malinvestments are still on the accountant books.

Raising interest rates will (1) wipe the malinvestments off the accountant books, leading to a true price level, then after the economic correction; (2) the higher interest rates (in the Evenly Rotating Economy, the natural interest rate is pure profit) will spur less consumption and greater investment.

The question is, why does Merkel continue to keep Greece, Portugal, Spain, Ireland and Italy in economic crisis? Such a long-lasting crisis can only end up destroying the EU itself. And that’s the reason Comrade Merkel (Angela Merkel’s East German Stasi code name was ANITA) wants to prolong this crisis, to break up the EU, because when the EU breaks up so will NATO, and the USSR wants NATO gone.

For those of you who wondered why I said ‘USSR’, well that’s because the collapse of the USSR (and East Bloc) was a strategic ruse under the Communists’ “Long-Range Policy”, which all Communist nations signed onto in 1960 as their “new” strategy to defeat the West with, as revealed to the West in 1961 with the defection of KGB officer Major Anatoliy Golitsyn, the only Soviet-era defector to still be under protective custody in the West (what does that tell you?).

Oct 09, 2012 1:35pm EDT  --  Report as abuse
JeffreyV wrote:
@GlennatAOL unfortunatly things aren’t as simple as that. I’ve been here in Greece for the past 12 years, and the only thing that is clear to me is that Greece is just a pawn in a much bigger game. Believe me, our corrupt politicians couldn’t possibly do this much damage on their own.

Oct 10, 2012 1:54am EDT  --  Report as abuse
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