Greece on road to solving problems: Austria's Fekter

(VIENNA) - Austrian Finance Minister Maria Fekter, who typically defends a hard line on aid to struggling eurozone countries, expressed unusual confidence on Monday that Greece would be able to solve its problems.

"Yes, I'm seeing that," Fekter said, when asked by daily Der Standard whether the government in Athens had the will to implement much-needed reforms.

"The idea that we could easily push back the Greek programme by a year or two, was rejected. We said very clearly that this wouldn't do," she said.

"This led to some rethinking (by Athens). The government began intensively drafting consolidation measures for 2013, to make up for what it failed to do in 2012.

"We will give them another couple of weeks' time," Fekter said in reference to a report, expected in October, from the troika of auditors representing Greece's EU, IMF and ECB creditors.

On Friday, the head of the International Monetary Fund, Christine Lagarde, said that an option that "needs to be considered" was to give Greece more time to meet bailout targets -- something Athens has been seeking.

"There is only one time factor, and that relates to the troika's final report on how much time Greece will have to catch up on measures it failed to push through because of this summer's elections," Fekter said Monday.

The Austrian minister, who once voiced the idea of kicking partners out of the eurozone, also changed her tune on that matter.

"There were times when we discussed Greek exit scenarios. But we (eurozone finance ministers) have come to the conclusion that a break-up of the eurozone would have negative effects for everyone, really everyone.

"It would be incomparably more costly than what we are doing now. For this reason, I no longer concern myself with such scenarios," she said.

Fekter also said Spain could need far less to save its banks than the 100 billion euro ($131 billion) rescue agreed by its eurozone peers.

"We're hearing the demand is far under the 100 billion," Fekter told the daily.

When asked to give a figure, she estimated Madrid would require "around 60 billion euros."

"The government will have to fulfil the European Commission's requirements regarding the excessive deficit, a massive challenge," she said.

"But the Spanish train is running, the bank recapitalisation is on track."

Madrid accepted a banking sector rescue of up to 100 billion euros from eurozone partners to help its banks, still reeling from a 2008 property market crash.