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Germany’s debt to Greece

Germany’s debt to Greece

Editor

Greece wants war reparations and loan repayments from Germany, writes Klaus Neumann in an Inside Story article. The idea isn’t as far-fetched as it might sound.

The public debt of Germany stands at around €2 trillion. And while Germany’s public-debt-to-GDP ratio is less than Greece’s, it is still well above the 60 per cent stipulated in the Maastricht Treaty as the upper limit for countries joining the Eurozone. According to Neumann:

“In April, the deputy finance minister of Greece announced that Germany owes Greece €278.7 billion – enough to allow Greece to repay its debt to the EU, and about five times the amount Germany contributed to the Greek bailout.

“The Greek government claims that the bulk of the German debt is made up of outstanding reparations for suffering and material damages inflicted on Greece during the second world war.

“The €278.7 billion claim includes €10.3 billion for funds Germany forced the Greek central bank to lend it during the second world war.

Borrowers or pillagers? German officers at the Acropolis in May 1941, shortly after the capitulation of Greece. The person holding the baton is Field Marshall Walther von Brauchitsch, who oversaw Germany’s campaign in the Balkans. (Bundesarchiv, Bild 101I-165-0412-14A/Rauch/CC-BY-SA ).

“For months, as a committee of the Greek parliament has trawled through the records and calculated the interest, all sorts of figures have been put on that debt. But now it’s official, at least as far as the Greeks are concerned. ”

Source: Inside Story article, 20 April 2015 Author: Klaus Neumann http://insidestory.org.au/debts-and-other-legacies

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