Germany Refuses Greece’s Loan Request

Under pressure from creditors, Greek PM retreats from pledge to end austerity.

By Published on February 19, 2015

(Bloomberg) — Germany rejected Greece ’s request for an extension of its aid program, saying its offer doesn’t meet the euro region’s conditions for continuing aid.

The Greek government is trying to agree bridge-financing without meeting the conditions of its existing rescue program, German Finance Ministry Spokesman Martin Jaeger said in an e-mailed statement. European Commission Spokesman Margaritis Schinas moments earlier had said the Greek letter could be the basis for a “reasonable compromise.”

The euro dropped 0.3 percent to $1.1358.

With the Greek state and its banks shut out of financial markets and dependent on emergency aid to stay afloat, Prime Minister Alexis Tsipras is retreating from his pledges to end austerity as the country’s creditors tighten the financial vise.

Tsipras’s government in a letter to fellow euro member states offered to work for the “successful conclusion and review” of the current financing agreement with creditors in a bid to avert a cash crunch.

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