Germans try to slow down Greek talks

By Florian Eder

Angela Merkel's government doesn’t appear to want a quick conclusion.

This weekend could bring significant progress on a Greek finance package — unless the Germans decide to spoil it.
The negotiations over a third bailout deal are entering a “decisive phase,” according to sources from the institutions involved in the talks.

But not everyone is keen on swift results.
The negotiators in Athens are speeding up. The European Central Bank and the European Commission want to finalize the €85 billion package by August 20, which is the deadline for Greece to repay another €3.2 billion loan.
A draft version of the conditions could be sent to finance ministries as early as this weekend. European Commission President Jean-Claude Juncker told Agence France-Press this week that he was confident a deal could be struck on time, despite some remaining difficult issues.
Greek Prime Minister Alexis Tsipras, too, praised the progress being made in his talks with creditors.
He released a statement that said he had agreed with French President François Hollande that the “negotiations can and must be concluded immediately after August 15.”
But the Germans are skeptical. A complex deal like the Greek one needs more time to be concluded, one government official said, considering the magnitude of it.
Süddeutsche Zeitung and the economic daily Handelsblatt both quoted a finance ministry official, too, as saying that it was “better to negotiate for two or three weeks longer and then have a sensible program.”
This development suggests that German Finance Minister Wolfgang Schäuble prefers another bridge loan, of €5 billion, which would enable Greece to make the August repayment to the ECB and another in September.
While parliament will need to vote on a full bailout deal, the disbursement of another bridge financing loan would require approval only from the Bundestag’s budgetary committee.
While it would not save Schäuble from another vote in the plenary, the 630 Bundestag members would at least not have to come back from their summer break.
A delayed deal would buy the German government time to finesse the issue.
While Chancellor Angela Merkel made clear that the involvement of the IMF is crucial for her, the Fund itself is a difficult partner which is calling for a restructuring of Greek debt — a haircut, essentially. But Merkel has ruled it out. Portuguese and Spanish leaders who face elections in the fall also expressed opposition to a debt restructuring.
There is another upside potential for Schäuble: The longer the negotiations take, the more likely it is that Tsipras will face a showdown with his party and perhaps even another Greek general election that empowers the new government to conclude a deal.