German chancellor Angela Merkel and French President Francois Hollande said they would consider measures to spur economic growth in Greece as long as voters there committed to the austerity demanded to stay in the euro. Requests for measures to bolster growth will be “considered” and the European Union may also “approach Greece with proposals,” Merkel said late on Tuesday at a joint press conference with Hollande during his first official visit to Berlin. “Greece can stay in the euro area,” and “Greek citizens will be voting on exactly that.”
Their encounter, the first meeting between the chiefs of Europe’s two biggest economies, came after Greece announced a return to the ballot box following the collapse of talks on forming a government. The euro and stocks fell as investors speculated that Greece may drop out of the single currency more than two years after its budget-deficit blowout triggered a financial crisis across Europe that continues to rage. Hollande saw Merkel less than 12 hours after being sworn in as president and an arrival that was delayed by a lighting strike on his plane from Paris.
With Greece in its fifth year of recession, the French Socialist returned to a theme he pressed throughout his election campaign, saying policy makers must offer the prospect of something more than austerity. “I’ll respect the vote of the Greeks whatever it is,” Hollande said. “Yet my responsibility is to give Greece a signal. I see the suffering and challenges that the Greeks feel. The Greeks need to know we’ll come with growth measures that will allow them to stay in the euro zone.”