August 18, 2012 / 3:02 PM / 6 years ago

German finance minister: no new aid program for Greece

BERLIN (Reuters) - German Finance Minister Wolfgang Schaeuble said on Saturday that there were limits to the aid that could be granted to Greece and said the crisis-stricken country should not expect to be granted another program.

“It is not responsible to throw money into a bottomless pit,” Schaeuble said at a government open day in Berlin. “We cannot create yet another new program.”

With Greece in its fifth consecutive year of recession and social and political discontent rising, its Prime Minister Antonis Samaras is keen to soften the impact of budget cuts on society by extending the deadline international lenders set it.

Samaras is expected to float a proposal for a two-year extension when he meets with the leaders of France and Germany next week.

Schaeuble stressed that the euro was a stable currency and said inflation was lower than when Germany had the Deutsche mark, adding that there was no sign of price pressures stepping up at the moment.

Schaeuble also rebuffed demands to finance state debt via the European Central Bank (ECB): “If we start doing that, we won’t stop. It’s like when you start trying to solve your problems with drugs,” he said.

The ECB indicated earlier this month that it may again start buying government bonds to reduce crippling Spanish and Italian borrowing costs

Reporting by Thorsten Severin; Writing by Michelle Martin; editing by Ron Askew

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