KeepTalkingGreece — Otmar Issing, former Chief Economist and Member of the Board of the European Central Bank and the German Bundesbank, brings back Grexit scenarios, demanding a Euro-sabbatical for Greece. In an interview with business news magazine Wirtschaftswoche, Issing warned of a new flare-up of the euro crisis.
“The euro crisis is not over yet,” said the economist, one of the architects of the Euro.
Issing called on a policy that would include EU treaties allowing the possibility of temporary withdrawal from the monetary union.
“States like Greece would do well with a Sabbatical outside the monetary union. However, it should be accompanied by massive aid from other countries and a growth-oriented economic policy. And one would have to make re-entry into the euro zone dependent on fundamental reforms, ” Issing said.
Issing no longer relies just on the Stability and Growth Pact, a core element of the economic and monetary union. He would like to see additional harsher measures, such as a sabbatical from the euro, for countries who do not comply with the eurozone fiscal rules.
Otmar Issing lashed out at the Greek government saying “the government is still in an anti-growth policy.”
He also criticized Italy saying “It also did not seize the opportunity. The country has saved tens of billions of interest without using the leeway. ”
The Wirtschaftswhoche article has the title “Economist demands Euro-sabbatical for Greece.”
Issing has been calling for Grexit since 2010 saying Euro exit would be good for Greece at least once a year since.
“The euro is irreversible – but if it is irreversible for every country has become an open question,” Issing told CNBC on Tuesday.
In September 2015, Issing told CNBC “For Greece, there are very good arguments that it would do well outside the euro area for some time to come, but it all depends on the Greek government’s reactions” .
German finance Minister Wolfgang Schaeuble, who by 2015 was convinced by Issing’s argument, estimated a cost of at least 50 billion euros for a 5-year- euro sabbatical for Greece when he made an offer to the Greek government.
Schaeuble had offered Varoufakis a temporary Grexit plan in March 2015, as part of the European lenders plan to pressure the Greek government, something known at the time, but which is now rediscovered by political circles in Greece who blame Varoufakis and the 2015 government for entering into a discussion with Schaeuble on the subject,
