Merkel ally: No wiggle room for Greece

The parliamentary head of Angela Merkel's party warned Sunday that crisis-wracked Greece had "no room for manoeuvre" ahead of talks this week between the German chancellor and the Greek prime minister. Volker Kauder, parliamentary group leader of Merkel's conservative bloc, told Der Spiegel weekly: "The Greeks have to stick to what they have promised. There is no room for manoeuvre, either in terms of time or substance." "That would be yet another agreement broken. That's exactly what led us to this crisis," Kauder said. Prime Minister Antonis Samaras is due to visit Berlin on Friday before heading to Paris for talks with French President Francois Hollande the next day. According to Greek media, Samaras will discuss extending a deadline for Greece, which is threatened with bankruptcy, to make budget cuts in return for its next slice of aid while stopping short of making a formal request. The Financial Times reported Wednesday that Samaras would ask for two more years to make the demanded cuts. Auditors from the European Commission, European Central Bank and International Monetary Fund -- known as the Troika -- will release a report in mid-September on Greece's progress towards achieving the required austerity. According to Der Spiegel, this report will call for Athens to slash 14 billion euros ($17 billion) from its budget over the next two years, 2.5 billion euros more than originally demanded. Der Spiegel said the extra cuts were needed because planned privatisations were not shaping up to be as lucrative as hoped and tax revenues were falling short of forecasts as Greece struggles through its fifth year of recession. Kauder reiterated that Europe should strive to keep Greece in the eurozone, but stressed that the Troika report would be the basis for further decisions. "We should do everything to stick together. When the first difficulties appear, you don't throw the children out of the house. I am going to wait to see what the Troika says," Kauder said.