FILE - In this Nov. 30, 3012 file picture German Chancellor Angela Merkel casts her vote at the German federal parliament, Bundestag, in Berlin, Germany, Friday, Nov. 30, 2012. The German Parliament has given its overwhelming backing to a deal aimed at trimming Greece's debt load and keeping the country financially afloat. Lawmakers voted 473-100 on Friday to back the complex deal reached by European finance ministers earlier this week. Germany's chancellor says in an interview published saturday Dec. 1, 2012 she understands the frustration felt by many Germans over the repeated bailout programs for Greece. But Angela Merkel also insists that helping debt-ridden Greece is in her country's self-interest because it helps stabilize the 17-nation eurozone on which Germany's prosperity depends. (AP Photo/Michael Sohn,File)
FILE - In this Nov. 30, 3012 file picture German Chancellor Angela Merkel casts her vote at the German federal parliament, Bundestag, in Berlin, Germany, Friday, Nov. 30, 2012. The German Parliament has given its overwhelming backing to a deal aimed at trimming Greece's debt load and keeping the country financially afloat. Lawmakers voted 473-100 on Friday to back the complex deal reached by European finance ministers earlier this week. Germany's chancellor says in an interview published saturday Dec. 1, 2012 she understands the frustration felt by many Germans over the repeated bailout programs for Greece. But Angela Merkel also insists that helping debt-ridden Greece is in her country's self-interest because it helps stabilize the 17-nation eurozone on which Germany's prosperity depends. (AP Photo/Michael Sohn,File)
FILE - In this Nov. 30, 2012 file picture German Chancellor Angela Merkel casts her vote at the German federal parliament, Bundestag, in Berlin, Germany. The German Parliament has given its overwhelming backing to a deal aimed at trimming Greece's debt load and keeping the country financially afloat. Lawmakers voted 473-100 on Friday to back the complex deal reached by European finance ministers earlier this week. Germany's chancellor says in an interview published saturday Dec. 1, 2012 she understands the frustration felt by many Germans over the repeated bailout programs for Greece. But Angela Merkel also insists that helping debt-ridden Greece is in her country's self-interest because it helps stabilize the 17-nation eurozone on which Germany's prosperity depends. (AP Photo/Michael Sohn, File)
German Chancellor Angela Merkel casts her vote at f the German federal parliament, Bundestag, in Berlin, Germany, Friday, Nov. 30, 2012. The German Parliament has given its overwhelming backing to a deal aimed at trimming Greece's debt load and keeping the country financially afloat. Lawmakers voted 473-100 on Friday to back the complex deal reached by European finance ministers earlier this week..The agreement paves the way for Greece to receive 44 billion euro (US $57 billion) in critical rescue loans, without which the country would face bankruptcy and a possible exit from the euro. (AP Photo/Michael Sohn)
German Chancellor Angela Merkel attends a meeting of the German federal parliament, Bundestag, in Berlin, Germany, Thursday, Nov. 29, 2012. (AP Photo/Michael Sohn)
German chancellor Angela Merkel stands in front of a huge Christmas Tree, she just received, in the chancellery in Berlin, Thursday Nov. 29, 2012. (AP Photo/dapd/ Clemens Bilan)
BERLIN (AP) ? Germany no longer rules out the possibility of forgiving Greece some of its debt once the country's finances are in order, Chancellor Angela Merkel said, signaling a softening of her government's tough stance on Greece.
The question of debt forgiveness, or a "haircut," can be revisited after the current bailout program will be successfully concluded and the government in Athens no longer takes on new debt, Merkel said in an interview with the German Sunday tabloid Bild am Sonntag.
Merkel's government had previously ruled out forgiving debt, arguing that Greece must implement the agreed-upon austerity measures and structural reforms in return for its bailout loans. But the International Monetary Fund and many economists say eurozone nations must also forgive Greece some of its debt to allow the country to overcome its debt crisis.
Greece is trapped by an unsustainable debt level ? forecast to reach 190 percent of the country's economic output next year ? which forces it to drastically slash its budget. That, in turn, deepens the country's recession, and makes Greece's debt load rise even more in relation to its gross domestic product.
When asked about a haircut on Greece's debt as a way out of the situation, Merkel told the newspaper "when Greece one day again manages with its revenue, without taking on new debt, then we have to look anew at the situation and reevaluate."
"That won't be before 2014-2015 if all goes as planned," she added.
Greece has promised its international creditors to achieve a budget surplus of 4.5 percent of its GDP by 2016, which would enable the country to start paying back part of its debt.
Greece, which is about to enter its sixth consecutive year of a deep recession that has pushed unemployment up to 25 percent, is being kept afloat with rescue loans from its European partners and the International Monetary Fund.
German opposition leaders and analysts have accused Merkel of playing down the need to write off some of Greece's debt held by eurozone governments before national elections in Germany next year for fear of voter retribution.
Merkel did not directly address that charge, noting only that Greece's current bailout programs runs through 2014, hinting that she sees no need for yet new measures before then.
The hawkish head of Germany's central bank, Jens Weidmann, last month said that Greece will eventually need a haircut, but it should only be granted after a prolonged period of budgets cuts and labor reforms there.
Earlier this year, Greece reached a deal with its private creditors to wipe some ?100 billion ($130 billion) off its national debt, or about half of the country's GDP.
Still, a second haircut on Greece's debt from the eurozone rescue loans might be necessary. Analysts say such a haircut could cost Germany, the main contributor to the bailouts, up to ?17 billion ($22 billion) ? more than 5 percent of Berlin's annual budget.
Merkel's comments came only two days after Germany's parliament voted in favor of granting Greece more lenient terms on its bailout program, clearing a necessary hurdle for disbursing a ?44 billion ($57 billion) rescue loan payment in December that Athens needs to avoid bankruptcy.
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Juergen Baetz can be reached on Twitter at http://www.twitter.com/jbaetz
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