Angela Merkel's bombshell eurozone confession unveiled after Brexit swipe at Macron

Mrs Merkel has told the European Union that it must be more realistic in accepting Britain’s negotiating position in fishing and trade talks. Her comments came as British sources blamed EU divisions and sabre-rattling from France for the missing of a deadline to find an agreement this week. Mrs Merkel, who holds the EU presidency, told a meeting of European mayors that a deal was “particularly urgent from the Irish perspective”.

She said: “We are going to continue to stand together in these withdrawal talks. But we also have to take into account the reality. An agreement has to be in the interests of both parties, in British interests as well as the interests of the 27-member EU.”

It is widely believed Mrs Merkel will play an influential role in brokering any UK-EU trade agreement in the coming weeks.

Other European leaders expect her to push French President Emmanuel Macron to compromise on his hardline demands to secure continued access to Britain’s coastal waters after the end of the year.

However, it is not going to be easy.

As he arrived at the EU summit, Mr Macron said: “In no case shall our fishermen be sacrificed for Brexit. If these conditions are not met, it’s possible we won’t have a deal. If the right terms can’t be found at the end of these discussions, we’re ready for a no deal for our future relations.”

The summit ended with no breakthrough in sight and with chances of no deal severely increasing.

As tensions are set to rise in the incoming days, unearthed reports reveal how German Chancellor Mrs Merkel made a startling confession about the eurozone in 2013.

Mrs Merkel said Greece should never have been allowed into the euro and put the blame on former Chancellor Gerhard Schroeder.

The German leader’s outburst came as she attempted to prove to voters she maintained a tough stance on struggling euro countries, just a month before facing key elections.

Ms Merkel told around 1,000 supporters of her Christian Democratic Union party in Rendsburg: “Greece shouldn’t have been allowed into the euro.

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“Chancellor Schroeder accepted Greece in [in 2001] and weakened the Stability Pact, and both decisions were fundamentally wrong, and one of the starting points for our current troubles.”

Ms Merkel reiterated her desire to see a strong single currency, but warned that it could have only been achieved through reforms in struggling countries such as Greece.

She added: “That [a unified euro area] is such a treasure, such a boon, that we can’t place it in doubt.

“That’s why the euro is more than a currency.

“For this reason we’ve shown solidarity, but solidarity is always linked to responsibility for reforms in those countries that experience our solidarity.”

Germany, a leading nation in the Greek bailouts, earned huge sums in interest payments since the crisis.

In 2010, eurozone countries bought €210billion (£190bn) of government paper, including Greek bonds, in order to provide greater liquidity to the EU’s banks as the Greek debt crisis unfolded.

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According to figures obtained from Mrs Merkel’s government by Germany’s Green Party in 2018, Germany received €2.9billion (£2.5billion) in interest payments on Greek bonds that were bought through a now-defunct bond-buying programme.

Germany also received a total of €400million (£341million) on a loan from the KfW Development Bank.

The original agreement between Berlin and Athens was for any interest earned on the bonds to be paid back to Greece when it fulfilled its reform obligations.

However, Germany repaid €527million (£449million) of interest payments to Athens in 2013 and €387million (£330million) in 2014.

After Greece’s second bailout programme was agreed in 2015, those repayments stopped, and Berlin accumulated the ongoing interest.

Therefore, Germany is reportedly €2.5billion (£2.1billion) in profit, plus interest of €400million (£341million) on a loan from the KfW development bank.

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