German politician quits amid rescue row

German politician quits amid rescue row

BERLIN - Reuters
German politician quits amid rescue row

Secretary General Lindner of Germany’s ruling Free Democratic Party arrives at party headquarters yesterday. REUTERS photo

A senior figure from Germany’s ruling Free Democrats unexpectedly resigned yesterday, FDP sources said, in a move that may be linked to an internal party referendum on eurozone rescue moves.

Christian Lindner, general secretary of the party and until now a rising star who many wanted to see take over as chairman, quit the number two job in the FDP hierarchy, the sources told Reuters.

“He lost his nerve,” an FDP official said, when asked about Lindner’s move. FDP leaders have warned that Merkel’s center-right coalition could collapse if opponents in the party of the eurozone’s rescue fund win a poll of party members. The 64,000 FDP members had until Dec. 13 to vote on the non-binding referendum.

The results of the referendum, which was pushed through against the will of Lindner, are due on
Dec. 16.

The referendum needs a quorum of 21,000 members taking part for it to be valid. The balloting ended on Dec. 13 and early indications were that the minimum was not achieved - a result that would cast a bad light on Lindner.

In another development, Italy paid a euro-era record of 6.47 percent on its new five-year bonds, compared with the previous record of 6.3 percent set in November.

Germany also sold debt, raising 4.2 billion euros at an auction of two-year bonds at average yields of 0.29 percent, compared with 0.39 percent at the last such auction.

The German sale drew bids worth 1.4 times the amount on offer, up from 1.1 times at the last auction and the low yields illustrated how desperate investors are to find a safe haven for their money.