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Merkel moves to mend Greek fence

Tuesday, March 17, 2015 - 02:13

(Warning: profane gestures) German Chancellor Angela Merkel has invited for Greek counterpart to Berlin for talks next week as relations between the two countries deteriorate further. But is it too late for bridge building? David Pollard reports

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EDITORS PLEASE NOTE: THIS EDIT CONTAINS PROFANITY Gesture politics. Defined as a political action focused on publicity. But given an added twist in a 2013 video purportedly suggesting Yanis Varoufakis didn't want any financial help from Germany. UPSOUND GREEK FINANCE MINISTER YANIS VAROUFAKIS SAYING ON VIDEO: ''And stick the finger to Germany and say, 'well, you can now solve this problem by yourself.' The Greek finance minister denies making the sign. Some in Athens find it hard to believe, too. (SOUNDBITE) (Greek) ATHENS RESIDENT, NIKOS, AGED 70, SAYING: "If it's true that he did this then he is harming Greece's image. If the video's been edited, as Varoufakis says, then this is fiction, it doesn't represent his stance." Local newspapers headline another gesture. An invitation from Angela Merkel to Alexis Tsipras. The German Chancellor has asked the Greek leader for talks next Monday. It's seen as a move to soothe a new level of irritability in relations. On the big issue - Greece's debt - Germany's finance minister Wolfgang Schaeuble has accused Greece of destroying all trust. Tsipras angered Berlin last week by accusing successive German governments of legal tricks to avoid paying World War Two reparations. Anti-German rhetoric emerging exactly as Greek hopes for a significant debt restructuring recede, says Barclays' Will Hobbs. (SOUNDBITE) (English) WILL HOBBS, MARKET ANALYST, BARCLAYS, SAYING: ''There's just very little scope for the euro group to concede much ground to the Greeks. And what that means politically for Mr Varoufakis and Mr Tsipras is that they have to give the electorate something else. So give them more that story which they have enjoyed, which is the German bashing.'' Greece secured a four-month extension to its bailout last month - but to solve its cash crunch, it must agree on economic reforms with its creditors. Talks on that mask a deeper reality, says Hobbs, neither side wants to acknowledge just yet. (SOUNDBITE) (English) WILL HOBBS, MARKET ANALYST, BARCLAYS, SAYING: ''Greece ... is to all intents and purposes insolvent. However, I think the euro zone will want to do this extend and pretend routine for a little while longer. They'll want to be a little bit further down the track in building that credible fiscal and political architecture for the euro area.'' Germany and Greece not rebuilding bridges, perhaps, but at least keeping them propped up for the time being.