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Rehn: Bridge financing for Greece could undercut motivation for reforms

Finland's Minister of Economic Affairs Olli Rehn does not believe that the Finnish government is willing to agree to bridge financing for Greece for use in meeting its most pressing financial obligations.

Olli Rehn
Elinkeinoministeri Olli Rehn Image: Anni Reenpää / Lehtikuva

Olli Rehn, now Finland's Minister of Economic Affairs, was the EU's Commissioner for Economic and Monetary Affairs and the Euro from 2009 to 2014.

On Wednesday he reacted to news of a suggested plan to provide bridge financing to Greece with skepticism.

"The problem with this kind of bridge financing is that it usually lessens motivation to implement reforms. And that’s why the option of bridge financing has been turned down in previous negotiations with Greece. I don’t believe that the Finnish government will greet this with enthusiasm either," said Rehn.

Finland's stand on a third bailout package for Greece will be under review in Helsinki on Thursday.

First, the cabinet's Ministerial Committee on European Union Affairs will meet to formulate the government's position. After that has been established, Parliament's Grand Committee will meet to take a final policy decision on the issue. Rehn was unable Wednesday to say where Finland stands on the matter of a third Greece bailout package.

According to Olli Rehn, the participation of the International Monetary Fund (IMF) would be essential for the creation of a third bailout.

"At least previously, very many member states including Germany, Finland and The Netherlands have unconditionally demanded that the International Monetary Fund takes part. This is also in way a guarantee that Greece will implement reforms in the way it should, because oddly enough many member states do not trust the European Commission. So, if the IMF does not join in, it will undoubtedly affect agreement on a third bailout," stated Rehn.