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Germany owes Greece at least 11 billion euro for the forced occupation loan that the country had borrowed on behalf of the Nazis, although Berlin does not recognize this obligation.

According to a publication in the Greek newspaper To Vima, the members of the expert commission to the Greek Court of Auditors have arrived at this conclusion, taking into account the most conservative estimates of their calculations.

Commission chairman and former director of the state treasury Panagiotis Karakousis stresses that that the amount in question has nothing to do with the reparations for the damage caused during World War II and the occupation or with its consequences on the economy, which can amount to tens of billions of euro.

The secret report of 160 pages has been submitted to Deputy Minister of Finance Christos Staikouras who in turn will send it to Minister of Foreign Affairs Evangelos Venizelos and he in turn will submit it to the State Legal Council.

Under the constitution, the Council has to sit and adopt a decision, opinion, on the actions to be taken by the Greek cabinet in connection with the case.

The case of the occupation loan gained wide publicity about two years ago when a secret report prepared by the Greek Supreme Court was published. It described the following:

"A meeting of financial experts with the participation of Italy and Germany ended in Rome on 14 March 1942, at which the two occupying forces signed an agreement on Greece. It was signed by the representatives of Italy and Germany for Greece, Gidzi and Altenburg."

The decision was announced to Greece nine days later with a verbal note 160/03.23.1942 issued by Altenburg. His Italian counterpart had submitted his verbal note 04/6406/461 the same day.

In turn, the Greek Minister of Finance had issued an order to the Bank of Greece, stating that the management should comply with the verbal note of the German representative.

The agreement between the two occupying forces stated the following:

1. The Greek Government should undertake to give the two occupying forces the amount of 1.5 billion euro for the cost of the occupation, in equal shares.
2. All withdrawals from the Bank of Greece over the amount specified should be submitted to the governments of Italy and Germany in drachmas without interest.
3. The amounts exceeding 1.5 billion drachmas would be repaid at a later stage.

The text also specified that the agreement would enter into force retroactively from 1 January 1942.

On 2 December 1942 the Greek, German and Italian governments signed a contract which contained the following new details:

1. The loan amounts were determined in constant currency.
2. The loan would be suspended on 1 April 1943 when the interest-free payment would begin, i.e. regardless of when the war would end.
3. Instead of the 1.5 billion drachmas per month specified in the previous agreement the cost of the occupation would increase to 8 billion drachmas per month. The additional amounts "shall be provided in the form of a loan from the Bank of Greece to the governments of Italy and Germany."
4. The obligations would be paid after April 1943 with monthly instalments equal to 10 per cent of the total amount in the account as of 31 March 1943.

The second agreement preserved the condition of an interest-free loan too.

The three countries signed a third agreement on 18 May 1943. It was virtually an amendment and provided for the following: a) removing the limit on the ceiling of advance payments, i.e. the sum of 8 billion drachmas per month and b) in addition to living expenses the loan had to cover the costs of daily payments, building materials and fuel of the occupiers. The specific agreement entered into force on 1 April 1943.

A day after the publication of the Court of Auditors report in the newspaper To Vima, Berlin replied that no grounds allow Greece to require the payment of war reparations. In statements, spokesman of the German Ministry of Finance Martin Jaeger said that, so far, the Greek government has not submitted such a request.

"Almost 70 years after the war, the issue of compensation has lost its legitimacy. We see no basis for such a request."

He explained that this is the statutory response of the German Ministry of Finance, which considers the legal side of the issue and refers to the Agreement of 1960.

"It totally abolished the claims. The question of the payment of compensation was not raised even under the "2 + 4" contract for the reunification of Germany in 1990. This was recognized as a legal commitment within the context of the Paris Charter which Greece has adopted too," he said in conclusion.