Greeks seek easing of bailout as troika visits
INSPECTORS FROM the EU-IMF “troika” return to Athens today for their first meetings with new Greek premier Antonis Samaras, a mission which comes as his government is pressing to ease the terms of the country’s bailout.
The troika’s reform programme for Greece is well behind schedule following two general elections in as many months and political campaigns in which the prospect of the country leaving the euro was debated openly.
Mr Samaras was elected with a pro-bailout mandate but doubts remain in official and diplomatic circles in Europe about the viability of the rescue plan for the country and, ultimately, its membership of the single currency.
The new government wants to prise big concessions from the troika, saying the worsening economic outlook and rising unemployment justify a relaxation of the austerity package.
But this is being resisted on the European side, where officials say there is no scope for anything other than minor adjustment.
European Central Bank executive board member Jörg Asmussen said on Monday that the government “should not lose precious time looking to avoid or loosen the programme”, a view echoed in many euro zone countries.
While pushing for an extension of fiscal deadlines and a dilution of the reform programme, Mr Samaras is trying to cultivate trust in his administration and its determination to see the bailout through.
“The new government accepts ownership of the adjustment programme and is fully committed to its targets, its objectives and all its key policies,” Mr Samaras said in a letter last week to European Commission chief José Manuel Barroso.
However, Mr Samaras’s hard line against the bailout terms when in opposition has led many euro zone officials to view his promises with considerable scepticism.
Government spokesman Simos Kedikoglou told Greek television yesterday that the deterioration in economic conditions necessitated changes to the memorandum, saying new economic data pointed to a “shocking” situation.
“We will present information that is astounding. It is alarming in terms of the recession and unemployment, and it shows beyond any doubt that the current policy does not bring results. It brings the opposite results,” he said.
“Using this data as our weapon and presenting our alternative proposals, we believe that we will succeed in a new path being approved.”
Although detailed discussions lie ahead on a revision of the troika’s memorandum of understanding with Greece, the spokesman for EU economics commissioner Olli Rehn described today’s visit as a short “fact-finding” mission to assess the implementation of the rescue plan.
Greece should have executed 77 individual reforms by the end of June to keep the bailout on track but many targets were missed. Now the troika wants to find out exactly where the programme stands.
Talks about revising the plan are expected to continue for weeks. The effective deadline for a deal is a €3.8 billion bond redemption in August, a transaction Greece will not be able to complete without new aid.
Mr Samaras was unable to attend last week’s EU summit due to eye surgery and his original choice for finance minister, Vassilis Rapanos, stood aside on medical advice.
Amid unconfirmed reports that Slovenia might need a bailout, the leader of Bavaria’s conservatives has threatened to pull out of Chancellor Angela Merkel’s government if further euro zone states secure bailouts.
“At some point, the time will come when the Bavarian state government and the CSU cannot say ‘yes’ any more,” Horst Seehofer told Stern magazine. “And without CSU votes, the coalition has no majority.” – (Reuters)