Germany is not considering changing its approach to Europe's debt crisis, despite opposition to its austerity policies in Greece and France. Chancellor Angela Merkel rejected the idea that Europe was about to shift its policies after Francois Hollande's victory in France and Greek voters punishing parties that cut spending for a bailout. Merkel's allies indicated that they expected Hollande to make concessions and backpedal on promises made during his campaign, which Germany views as risky for the eurozone. Volker Kauder, parliamentary leader of Merkel's conservatives, emphasized that the German government's stance is unequivocal: they will maintain their commitment to fiscal austerity. After a disappointing performance by Merkel's Christian Democrats in a recent state election, it is clear to her that in order to secure a third term in office, she must address the concerns of German voters who do not want their money to be given away to foreign countries. Kauder, a close ally of Merkel, warned that Germans may end up bearing the financial burden of a Socialist victory in France through increased guarantees and funding, a situation that he deems unacceptable. Germany is not here to fund promises made by France during their election. These promises, including balancing the budget, hiring more teachers, implementing a high tax on million-euro incomes, raising the minimum wage, and supporting euro zone bonds and ECB involvement in growth, are seen as costly and go against German norms. Andreas Schockenhoff, a CDU lawmaker, predicts that Hollande will soon commit to stability policies. Merkel's spokesperson, Steffen Seibert, emphasized at a news conference that the key to moving forward in Europe is through growth achieved by structural reforms, such as changes to tax and labor laws to enhance trade, rather than relying on debt-funded stimulus plans. Merkel herself stated that while tactics can be discussed, the overall strategy agreed upon by EU leaders for fiscal consolidation is non-negotiable. She acknowledged that France, under its new president, will bring its own perspective to the debate, but stressed that solid finances and growth are both necessary for progress. Merkel reached out to Hollande, whom she had never met, after his victory, and the two leaders spoke for nearly 15 minutes with the help of interpreters. Sources informed Reuters that the discussion between Hollande and Merkel was amicable, with Hollande expressing his desire for strong relations. Hollande is scheduled to travel to Berlin next week, likely on May 16, following his inauguration, for his first international visit. Merkel stated that Hollande would be greeted warmly. Germany has indicated its readiness to discuss a "growth pact" with the incoming French president, potentially enabling Hollande to highlight progress in his efforts for a more equitable crisis strategy. However, it is improbable that bold new initiatives which could greatly benefit struggling economies such as Greece and Spain will be implemented. CDU budget expert Norbert Barthle mentioned to Reuters that while increasing growth is important, the key is determining how to achieve it. German officials have suggested that they are willing to consider a more flexible approach to using EU structural funds, increasing the capital of the European Investment Bank (EIB), and permitting the issuance of "project bonds" for infrastructure investment. These measures would not necessitate a significant amount of new funds from Berlin, making them feasible options. However, Germany is against the idea of implementing new government stimulus programs, extending the time for euro members to reduce deficits, or giving the ECB more authority to promote growth. A high-level German source stated that there will be no relaxation of deficit targets, and pointed to Hollande's victory speech in Tulle as evidence of his willingness to cooperate with Germany. Hollande's second priority of reducing the deficit was seen as a significant signal. Hollande's chief economic adviser, Michel Sapin, also emphasized that the expectation is not to simply distribute money upon taking office. Officials in Berlin and Brussels are taking a firm stance on Greece, emphasizing that there is no room for the country to back out of or renegotiate the terms of its multi-billion euro rescues by the EU and the IMF. The recent election results in Greece, which saw a surge in support for extreme parties, have raised concerns about whether Athens will uphold its commitments and sparked speculation about the possibility of the country being forced out of the euro zone. A senior euro zone source stated that Greece must either adhere to the program and receive financing from member states or face default. The consequences of default are uncertain, but it is likely to result in further hardships for Greek citizens. At the heart of the European project, which was established by France and Germany to put an end to a series of wars, Hollande can count on the support of Italy, the euro zone's third largest economy. Despite facing challenges from a stagnant economy and budget cuts aimed at pleasing creditors, Prime Minister Mario Monti's government in Italy has backed Hollande's pro-growth agenda. Hollande's approach towards Germany, France's key partner, will be revealed when he announces his government later this month. Jean-Marc Ayrault, a German-speaking candidate who has shown willingness to cooperate with Berlin, is a top contender for the position of prime minister over Martine Aubry, a more traditional Socialist. This choice would indicate Hollande's readiness to compromise. Louis Gargour, chief investment officer of hedge fund LNG Capital, expressed his curiosity about whether Hollande will initiate his presidency by engaging in a conflict with Merkel. Gargour views this as a clash between Keynesian economics and a emphasis on growth, as opposed to a prolonged period of austerity that voters are increasingly weary of.