Berlin – Since 2010, Greece has received some 289 billion euros’ (330 billion dollars’) worth of support from the European Stability Mechanism (ESM), the money coming overwhelmingly from European partners as well as from the International Monetary Fund (IMF).
Germany also supported Athens with credits from the beginning and it also has a share of the billions in aid provided by the Euro stability funds ESM and EFSF (European Financial Stability Fund). After the third rescue programme comes to an end, Greece will still profit from extended loan repayment schedules and interest and repayment deferrals.
Taxpayers in Germany will only have to help out if Athens does not repay the aid loans. The repayment to the Europeans starts only in a few years’ time and will go on for decades.
So far, Germany is one of the biggest countries to profit from the aid, with gains from interest reaching at least 2.9 billion euros. Following is a summary of the aid efforts:
First rescue programme, 2010-2011:
The euro partners in the beginning provided Athens with bilateral credits. Via its state development bank group KfW, Germany dispensed 15.2 billion euros to Greece. All told, the first rescue package amounted to pledges of 110 billion euros from the euro-member states and the IMF. In the end, 73 billion euros were paid out.
Second rescue programme, 2012-2015:
According to the ESM, the EFSF together with the IMF set aside 153.8 billion euros for Greece. The fund borrowed the money from capital markets, meaning that private investors could buy EFSF paper which was guaranteed by the donor countries. For any EFSF losses, Germany must cover 29 per cent. In addition, Germany faces liability risks from European Central Bank claims and IMF credits.
Third rescue programme, 2015-2018:
This was the permanent rescue facility, the ESM. Under the third programme the ESM provided Greece with 61.9 billion euros. The IMF was not financially involved. The euro countries provide no guarantees for the money raised by the ESM on the capital markets. Germany’s share of the ESM’s share capital of 705 billion euros is 27 per cent so that the Germany maximum liability risk is 190 billion euros.
Under the framework of further debt relief, Athens was given a 10-year extension on its loans and a deferral on repayment of interest and principle. ESM credits for example must be repaid between 2034 and 2060. Repayment of EFSF loans has also been extended. According to the German Finance Ministry, the volume of additional interest repayment deferrals of over ten years will depend on interest rate developments. Current estimates are of around 34 billion euros. The aid is dependent on economic reform and stringency efforts in Greece.