ATHENS (Reuters) - Germany pledged on Friday to advise Greece on cutting red tape and attracting private investment to help its economy get back on its feet and have a fighting chance to cope with its debt.
Berlin has offered to send civil servants and banking experts to guide Athens on matters of investment, project financing, regulation and EU subsidies, under the terms of a bilateral agreement signed after two months of talks.
German Economy Minister Philipp Roesler inked the deal during a visit to Greece as head of a 70-strong delegation of German industry representatives who seek business in the debt-laden country, mainly in renewable energy and waste treatment.
Roesler and Greek Development Minister Mihalis Chrysohoidis hailed the agreement as a key step in efforts to revive the debt-laden country's economy, which is expected to go through its fifth year of recession in 2012, partly because of austerity prescribed by its international lenders, including Germany.
"The purpose of this visit is to get German investments to Greece, to improve Greece's competitiveness," Roesler said. "It seems after all, that there is life after debt," Chrysohoidis said.
The German experts will help Greece to cut red tape, set up a new state bank to finance business projects, write new competition laws and make better use of European Union subsidies. There were no specific targets for trade or investment volumes.
The deal may also help to thaw relations between the two countries, which have suffered under the strain of the debt crisis.
Many German taxpayers are hostile to a 110-billion euro bailout for Athens agreed last year, in which Berlin is the biggest single contributor. At the same time, many Greeks think Germany is exacting too high a price for its solidarity.
"The stronger ones must help the weaker ones, especially in difficult times," the German minister said. "But this must build on economic prudence and financial rationality," said Roesler, who became last month the first German cabinet member to suggest that Greece may have to go into an orderly default.
Germany has a big stake in the Greek economy. Athens has been one of the biggest buyers of German armaments over the past decade. German companies manage some of Greece's largest firms, including the country's biggest telecoms company OTE and the Athens International Airport, managed by engineering firm Hochtief.
Greece's cash-strapped hospitals owe dozens of millions of euros in arrears to German drugmakers and health equipment providers, such as Bayer.
(Reporting by Harry Papachristou; editing by Stephen Nisbet)
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