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German euro bailouts challenged in court

German euro bailouts challenged in court
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Germany’s top court has began hearing legal challenges to Berlin’s participation in multi-billion euro bailouts to Greece, Ireland and Portugal.

The Federal Constitutional Court is unlikely to block Germany’s contributions to those bailouts, but will likely set conditions for approving further aid.

German Finance Minister Wolfgang Schäuble, defending the government’s position, said: “Parliament decided [on the bailouts], and in my opinion the court will uphold that decision – that the laws that we put in place are in accordance with the constitution.”

Schaeuble told the court that the euro currency area was at risk and the danger of contagion justified the need to help Greece with coordinated bilateral loans.

The case has been brought by academics and a politician who are all eurosceptic. A decision is expected in the autumn.

As the euro zone’s strongest economy, Germany foots over a quarter of Europe’s bill for the bailouts.

With a second Greek rescue being drawn up, many Germans are fed up with financing rescues of what they see as profligate states that have spent beyond their means.