Germans wary of Greeks bearing... reparations demands

The flag of Greece and the flag of Germany are pictured in Berlin.

A secret report leaked to the Greek press suggested that with one bound, Greece could be free of all its debts. The report, compiled on the orders of the Greek Ministry of Finance, argued the country has a valid claim for war reparations from Germany.

How much is that claim worth? In the neighborhood of $210 billion.

“This is a huge amount of money," says Gerasimos Georgatos of the Democratic Left, one of the governing parties in Greece. “This is almost 80 percent of our GDP. That means we have no more problem with the debt if we get this money. It’s very big money."

Georgatos thinks the figure is unrealistic, but a panel of experts came up with it after poring over thousands of pages of documents from government archives. The experts concluded Germany still owes Greece compensation for the havoc wreaked during the Nazi occupation from 1941 to 1944. More than 300,000 people died — many through starvation. Fifty percent of Greece's infrastructure and 75 percent of its industry were destroyed.

The German Finance Ministry has cried foul on the reparations claim, pointing out that compensation was paid to Greece in the 1960s. Hans Olaf Henkel, a leading German industrialist, says Germany is no longer liable for war damage to Greece, at least financially.

“Morally you will — as a German — never be able to say: we completed our obligations. Never, ever,” Henkel says. “But financially, I think everything has been settled."

Henkel, who is an arch opponent of the euro, says dragging up the reparations claim underscores how much the single currency has backfired. The euro was supposed to promote peace and  harmony in Europe but, Henkel argues, it is souring relations between member states.

The reparations claim is straining relations between Greece and its paymaster Germany and could further erode the German public’s support for bailing out Greece. For that reason, the report could be shelved.

A Greek government official was quoted saying: “This is no time to pick a fight with Berlin.”

About the author

Stephen Beard is the European bureau chief and provides daily coverage of Europe’s business and economic developments for the entire Marketplace portfolio.

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