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German FDP Seeking Message Rejects Shift in Euro Bailout Powers

Jan. 31 (Bloomberg) -- Calls to give the European Parliament more powers over economic adjustment programs in crisis-scarred countries are “extremely dangerous” because they risk weakening the conditions attached to the aid, the leader of Germany’s Free Democrats said.

Economic overhauls in euro-area countries such as Greece and Portugal that boosted unemployment and pushed economies into recession must not become “politicized,” said Christian Lindner, whose party is gearing up for European Parliament elections on May 25.

“It can’t be excluded that a structural majority of debtor states would impose decisions on donor countries, and that can’t be allowed to happen,” Lindner, who also leads the party’s parliamentary group in North Rhine-Westphalia, Germany’s most populous state, said in an interview in Berlin yesterday. “That’s a breach in the dike.”

His comments match the FDP’s message to German voters in the European election campaign, where the party is calling for the option to let countries exit the euro area while staying in the European Union. The FDP, which flirted with an anti-euro stance at the peak of the debt crisis, dropped out of Germany’s lower house of parliament in elections in September after failing to win the 5 percent needed to claim seats.

European lawmakers will continue to work to make the troika of European Commission, European Central Bank and International Monetary Fund more accountable, EU Parliament President Martin Schulz said Jan. 15 on Twitter. Schulz is a member of Germany’s Social Democratic Party, which replaced the FDP as Chancellor Angela Merkel’s junior coalition partner.

The European Parliament is examining the work of the troika over the past four years, sending a delegation to each of the rescued euro-area nations to help prepare a review that may call for more transparency and accountability. The troika’s review of Greece’s progress on meeting its bailout terms is a “difficult” process, Finance Minister Yannis Stournaras said on Jan. 22.

To contact the reporters on this story: Rainer Buergin in Berlin at rbuergin1@bloomberg.net; Arne Delfs in Berlin at adelfs@bloomberg.net

To contact the editor responsible for this story: James Hertling at jhertling@bloomberg.net

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