Germany, France united on Greece
Angela Merkel and Francois Hollande presented a united front towards Greece today, telling Athens it should not expect leeway on its bailout agreement unless it sticks to tough reform targets.
The German and French leaders met in Berlin to fine-tune their message to Prime Minister Antonis Samaras, who begins a charm offensive in Berlin and Paris this week in the hope of persuading Europe's big powers that Greece deserves patience.
Dr Merkel stuck to her policy of deferring to a report due in September on Athens' progress by the "troika" of international lenders before discussing flexibility on the bailout terms, but said it was vital "that we all stay true to our commitments".
"But we will, and I will, encourage Greece to continue on its path to reform, which has demanded a lot of the Greek people," she told reporters before a dinner with Mr Hollande set to be dominated by Greece.
"We want, I want, Greece to be in the euro zone, it's a desire we have expressed since the start of the crisis. It's up to the Greeks to make the effort that is essential for that goal to be met," said France's Socialist president, standing alongside Dr Merkel.
German sources who attended the working dinner later told Reuters the two leaders had vowed to work "together and with resolve" to overcome the euro zone crisis and had also agreed that "credibility" was the key to rescuing Greece.
A source close to the French presidency said the two leaders had wanted to have a "straightforward" talk on a host of hot-button topics, from the euro zone to Syria.
Mr Hollande plans to visit Spain on August 30th and Italy in early September, the source said. Both countries have seen their borrowing costs shoot up this summer amid market fears that the euro zone may start to unravel.
Mr Samaras has given interviews to German media stressing that while Athens may seek more time to meet its fiscal targets, it is not asking for more money. But German Finance minister Wolfgang Schäuble and others seemed unconvinced.
"More time is not a solution to the problems," Mr Schäuble said, addressing Samaras' hopes that his country might be given four years instead of two to push through painful economic reforms, to alleviate the impact on the Greek people.
Mr Schäuble said more time could also mean "more money" and Europe's help for Greece had already "gone to the limits of what is economically viable".
From the sidelines, Dutch finance minister Jan Kees De Jager - a staunch ally of Berlin - urged Germany to "stick with its strict position" and giving Greece more time would not help.
European leaders say any decisions on Greece will depend on the report by inspectors from the "troika" - the European Commission, the European Central Bank and the International Monetary Fund.
Mr Samaras is seeking what he calls "a bit of air to breathe" at a moment of rare optimism on financial markets that the EU and ECB are poised for decisive action on the euro debt crisis.
Behind their stern public message, Berlin and Paris may have little choice but to show some flexibility, with little appetite in either capital for forcing Greece out of the euro zone.
In talks that also touched on banking supervision in Europe and the role of the ECB, as well as civil war in Syria, Dr Merkel and Mr Hollande hoped to replicate the "Merkozy" alliance that gave the euro zone some semblance of unified leadership under Mr Hollande's predecessor Nicolas Sarkozy.
The Franco-German axis has been strained by Mr Hollande's calls for more measures to stimulate growth, a rebuff to Dr Merkel's strict agenda of austerity. Some German officials say the relationship with Mr Hollande is off to a rocky start.