Merkel did not propose Greek referendum, insists Berlin

AFP, Monday 21 May 2012

Germany says the German chancellor did not propose a referendum on Greece concerning its eurozone membership in coincidence with a general election, denying an earlier statement by the Greek caretaker PM

French President Francois Hollande (L) sits alongside German Chancellor Angela Merkel during the opening session of the NATO summit in Chicago, May 20, 2012. (Photo: Reuters)

A spokesman for Angela Merkel forcefully denied Monday that the German chancellor had suggested Greece hold a referendum on its eurozone membership at the same time as a general election.

"The fact is the chancellor did not propose a referendum and also said nothing that could be misunderstood as such," Georg Streiter insistently told a regular news conference, echoing similar flat denials last week.

On Friday, the Greek caretaker prime minister's office said Merkel had suggested in a phone call to President Carolos Papoulias that Greece should submit its eurozone membership to a referendum to be held alongside the general elections, expected on June 17.

German news weekly Der Spiegel reported in its Monday edition that Merkel did make the suggestion and added the idea had already been floated by German Finance Minister Wolfgang Schaeuble at a meeting with his eurozone counterparts.

"You can assume" that Merkel remains opposed to such a referendum, Streiter said, asked about a proposal last year by then Greek prime minister George Papandreou for a eurozone membership referendum, which provoked a German outcry.

And he recommended journalists read a report in Monday's Frankfurter Allgemeine Zeitung which said Merkel and Papoulias had agreed in the phone call that it would be desirable if the view of nearly 80 percent of Greeks who, according to polls, say they are in favour of eurozone membership, were also reflected in the June election outcome.

The newspaper said, without citing sources, that they had talked about the general election being "a bit like a referendum" on Greece remaining in the single currency bloc.

Streiter also repeated German opposition to eurobonds -- the pooling of eurozone countries' debt to make it easier for indebted countries to borrow on the financial markets.

"Joint eurobonds are not the way to resolve this crisis," he stressed.

He said the priority remained boosting competitiveness and balancing budgets in the eurozone member states.

New French President Francois Hollande said at the G8 summit at Camp David over the weekend that he would present his proposals for growth, to include eurobonds, at an informal European Union summit in Brussels Wednesday.

However, the term "eurobond" currently remains ambiguous, with some defining it more as "project bonds" which would be used to finance large investment works rather than countries.

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