Merkel underlines memorandum measures will continue after 20 August

German Chancellor Angela Merkel told a news conference that 20 August – when Greece’s bailout programme ends – is “an important day”, but she also underlined that the impact of the programme on Greece will not end on that date.

Merkel said that the fact that Greece has been given decades to pay off its debt is proof of trust.
At the same time, she categorically rejected reports that a VAT tax discount on five Aegean islands is linked to the agreement between Athens and Berlin on handling migration.

We must bring two things into balance. On the one hand is how long we will wait for the repayment of certain aid funding, and on the other hand there is the fact that we must continue for a certain period to express our expectations on issues such as the primary surplus,” Merkel said.

“If Greece does not produce a primary surplus, then it will not be possible to lower the level of its debt,” she said.

Regarding the debt relief package approved by the Eurogroup, Merkel said that “A large number of measures were taken to reduce the debt level, always within the framework of our rule that within the eurozone there cannot be a debt haircut in the classic sense.”

“I believe it is a good compromise. On the one hand, yes, the programme is over, but with that Greece is not yet in a situation as if there had never been a [bailout] programme,” she said.