Monday, 16 February 2015

Greece accuses creditors of bait-and-switch

Talks between Greece and its creditors broke down in Brussels on Monday, with Greece accusing them of a bait-and-switch strategy. 

Greek finance minister Yianis Varoufakis told journalists that he was presented with a surprise communique at a meeting of the Eurogroup, the single currency bloc's council of finance ministers. 

"Before this Eurogroup I met with [Economic Affairs Commissioner] Pierre Moscovici … he presented me with a draft communiqué I was happy to sign as it then stood," Varoufakis told journalists in Brussels. "It spoke of an extension of the present loan agreement by four months as a transition period for a new contract, and this would provide technical assistance to Greece in the meantime."

"But this draft was withdrawn by the Eurogroup president [Jeroen Dijsslebloem] and replaced with another, which took us back to last Wednesday, asking us again to extend not the loan agreement but the current programme," Varoufakis said. 

Talks had again reached an impasse on February 11, when the last Eurogroup meeting called on Greece to request an extension of its programme.

Greece's leftwing government has declared that it recognises Greece's debt, but will not extend the current programme of austerity and reform, which Varoufakis called "part of the problem, not the solution".

The ruling Syriza party was voted into power on January 25 on a promise to keep Greece in the single currency on more favourable terms. 

Eurogroup president Jeroen Dijsselbloem earlier invited Greece to extend their current memorandum of austerity as the only basis for further talks and flexibility. Moscovici, standing beside him, said "there is no alternative solution." 

"We are prepared to take no unilateral steps between now and August that might derail the current programme and have consequences for financial stability. But we could not support measures that would promote the recession such as raising VAT or act against pensions," said Varoufakis. 

Greece has asked its creditors to finance a four-month truce, during which to renegotiate the schedule of its debt repayments and the austerity measures.  

In Athens, conservative opposition leader Antonis Samaras said, "the government must remain in the negotiation process, which is the only path leading to a positive development for our country... a clash is not a solution." 

An impasse foretold 

Both sides seem to have come to these talks determined to stick to their guns. France's Europe1 radio station reported President Francois Hollande as being prepared for Greece to leave the Eurozone. "It is clear that Europe is ready to face it," he is quoted as having said. The Elysee did not deny the report. 

German finance minister Wolfgang Scheauble arrived at the Eurogroup declaring himself pessimistic. "It seems as though we have no progress so far," he said. "The Greek side has not moved, apparently." 

Varoufakis had earlier in the day published an opinion piece in the New York Times saying, "We are determined not to be treated as a debt colony... The lines that we have presented as red will not be crossed." 

As the Eurogroup meeting broke up, the Greek government issued a statement calling insistence on the existing memorandum "unreasonable and unacceptable". It said Eurozone members "evidently haven't realised that they aren't dealing with a government of yesmen."

Greece has been offered a final opportunity to request an extension of the programme before Friday. A statement from the Greek government has rejected this as "an ultimatum". 

No comments:

Post a Comment

Note: only a member of this blog may post a comment.