Germany Deeply Divided over the Greek Bailout Deal

On Friday, Chancellor Angela Merkel urged Germany’s lawmakers to approve a third rescue package designed to prevent Greece from leaving the euro zone. The Chancellor explained that the new bailout is necessary “for a strong Europe and a strong euro zone.” She also added it would be “grossly negligent” to spurn the bitter months of tense negotiations before this Monday’s agreement.

Yet, a third bailout is not wanted by many lawmakers in Germany. About 50 members of the Chancellor’s coalition may soon vote against the measure. The whole Europe is waiting for Germany’s approval to the $96 billion bailout. If the deal stands, Greece banks would be able to resume their normal activity after a period of three weeks when they kept their doors open.

Yesterday morning, the Greek parliament voted for the austerity measures imposed by the country’s creditors, but spurned by the Greek people with a 61 percent vote. The bailout divided politicians and made the prime minister say that Greece is affected by the worse downturn since the World War 2.

Deputy Finance Minister Dimitris Mardas announced Thursday that banks would be open and remain open on July 20. But Greeks who sought to withdraw the money from their savings accounts will still be limited to a daily $67 withdrawal. The good news is that they won’t have to stay in line in front of an ATM every day to do that.

Transfers of cash abroad will be also limited so imports and shortage in some medicines would still have to suffer the consequences. But until Europe’s money reach Greece, the terms of the bailout need to be negotiated several weeks.

In the meantime, E.U. leaders said that they have in store some short term solutions to help the country pay its most pressing debts. The European Central Bank announced that it would pump into Greece’s banks some money as early as Monday.

Although a few days ago everybody was pondering whether Greece should leave the euro zone, ECB’s president Mario Draghi said today that the country’s membership is no longer in doubt.

“Our mandate is to act based on the assumption that Greece is and will be a member of the euro area,”

Draghi added.

Though Finland approved the deal when everybody expected not to, Finnish lawmakers said that they would keep a close watch on Greece and see whether it implements the austerity measures requested by the creditors.

Image Source: Lapatilla