German Chancellor Angela Merkel said on Sunday it would be possible to talk about changing the maturities of Greece's debt or reducing the interest Athens has to pay after the first successful review of the new bailout package to be negotiated.
"Greece has already been given relief. We had a voluntary haircut among the private creditors and we then extended maturities once and reduced interest rates," Merkel said in an interview with German public broadcaster ARD due to be broadcast later on Sunday.
"And we can now talk about such possibilities again ... Once the first successful review of the program to be negotiated has been completed, then exactly this question will be discussed - not now, but then," she said.
Merkel stressed that a classic debt 'haircut' was out of the question as long as Greece remained a member of the euro zone: "That can happen outside a currency union but it can't happen in a currency union."
She said Finance Minister Wolfgang Schaeuble's suggestion that Greece could take a "time-out" from the euro zone had been considered but the euro zone had turned its back on the idea.
"The only option is to go down a common path with Greece, or to conjure up a chaotic situation because there would be no common decision among the finance ministers or the leaders. So the option was also on the table but we chose another option," Merkel said.
Greek banks are due to reopen on Monday after having been shut for three weeks but people will still only be able to withdraw a limited amount of cash and capital controls will remain.
"That's not a normal life so we have to negotiate quickly," Merkel said.
The chancellor said she would not speculate about a Plan B for Greece two days after German lawmakers gave the government a mandate to start talks on further aid for Greece.
She said Berlin would do all it could to bring talks to a successful conclusion but would "negotiate hard" to ensure Athens stuck to agreements.
"That certainly won't be easy because there are things that we have discussed with all of the Greek governments since 2010 that have never been done but that have been done in other countries like Portugal and Ireland," she said.
Regarding speculation in the German media on Saturday that Schaeuble might resign due to differences of opinion between him and Merkel over Greece, Merkel said: "The finance minister will, like me, conduct these negotiations and I can only say no one came to me and asked to be relieved."
© 2023 Thomson/Reuters. All rights reserved.