Greece 'will need another bailout'

German Finance Minister Wolfgang Schaeuble for the first time that Greece will need another bailout, triggering a storm of protest from opposition parties five weeks before an election in Europe's biggest economy.

While analysts have long predicted Greece will require more aid, albeit on a smaller scale than previous bailouts totalling about 240 billion euros ($320 billion), Chancellor Angela Merkel has tried to keep Greece out of her campaign for re-election to avoid angering German voters who fear they will foot the bill.

Just hours before Schaeuble spoke, Merkel was quoted in a regional newspaper as saying there was no point in discussing additional aid to Greece before the end of next year, when its second rescue package will expire.

But at a campaign event in northern Germany, her outspoken minister departed from that line, breaking what had been seen as an election campaign taboo.

"There will have to be another programme in Greece," Schaeuble said.

A Greek finance ministry official told Reuters a new bailout would involve sums far smaller than previous rescues and would focus on plugging an expected funding shortfall over 2014-2016.

"Greece and its lenders are examining several ways to plug any funding gap that Greece will face over the next few years," the official said on condition of anonymity.

The aid programme announced by Schaeuble will be at least partly financed via the EU budget, German newspaper Sueddeutsche Zeitung cited unnamed sources as saying in an advance extract of an article due to be published on Wednesday.

The newspaper said discussions were underway about making extra money from the EU's structural funds available to Athens, which could use it to boost the economy and free up national budgetary resources to pay off debt.

The newspaper cited government sources in Berlin as saying that the third aid programme would be much smaller than the first two and the conditions would also be less strict as Greece has already set a lot of the necessary changes in motion.

The International Monetary Fund last month estimated Greece's funding gap for 2014-2015 at 10.9 billion euros.