Tuesday

19th Mar 2024

Germany makes Greece pay with sovereignty for new bail-out

  • Angela Merkel got her way with a 'troika' on the ground in Greece (Photo: consilium.europa.eu)

Greek sovereignty was further undermined by eurozone leaders on Thursday (27 October), as Germany demanded a "durable" supervision on the ground of its economic policy-making under the terms of a second €130 billion bail-out.

The new rescue package, which comes with a 50 percent debt cut by private lenders and is to run until 2020, will include a "monitoring capacity on the ground" instead of current visits every three months by the troika of European Commission, International Monetary Fund (IMF) and European Central Bank lenders, the summit communique said.

Read and decide

Join EUobserver today

Get the EU news that really matters

Instant access to all articles — and 20 years of archives. 14-day free trial.

... or subscribe as a group

The aim of the mission will be to "advise and offer assistance in order to ensure the timely and full implementation of the reforms."

German Chancellor Angela Merkel pushed for the permanent presence instead of the current set-up, which sees the troika "coming and going every three months," she told journalists after the meeting.

As an afterthought, the leaders in their joint statement also referred to the EU commission-led "task force" of 25 experts who shuttle back and forth between Brussels and Athens and whose declared mission is also to help the government with reforms and tax collection.

"We fully support the task force on technical assistance set up by the commission," the summit declaration said.

On Wednesday, the head of the task force briefed journalists in Athens and defended the legitimacy of his unit, which had been formally asked for by the Greek Prime Minister Papandreou earlier this summer after EU commission chief Barroso and EU leaders convinced him to do so.

Papandreou also freely asked for the permanent troika, according to the summit conclusions.

Speaking to media on Thursday morning, Papandreou was thankful for the second bail-out and said that a default last year would have been worse than the 50-percent debt restructuring planned for January.

"We were guinea pigs for these bail-outs. We had to implement tough fiscal policies, we claimed European solutions," he said.

But there was no bad blood towards Merkel, at least in public statements.

"What the chancellor said fully complies with our position, we will be responsible in the implementation of this agreement. This will make a different country: more viable, more transparent," he said.

"The country that has been lending us money wishes that we succeed and we request their support. I would like them to be with us when there are issues and have discussions about it then, not three months later."

But ultimately, he stressed, nobody would be responsible for rebuilding the country other than "the Greek people, parliament and government."

Merkel wants 'permanent' supervision of Greece, warns of war

Peace should not be taken for granted if the euro fails, German chancellor Merkel told MPs Wednesday ahead of the eurozone summit. Greeks deserve respect for their sacrifice, she said, but their government has to be put under "permanent" supervision.

EU task force in Athens denies harming Greek sovereignty

The EU task force advising the Greek government on reforms defended its legitimacy on Wednesday, saying it is not eroding the country's sovereignty, just hours after Germany demanded "permanent" foreign supervision of Athens.

Merkel downplays budget tsar idea

German leader Angela Merkel on Monday spoke of her "frustration" at the slow pace of reform in Greece but avoided direct talk of imposing fiscal control from Brussels, an idea her French counterpart called undemocratic.

EU needs fewer presidents and a new budget 'tsar', say Finns

The EU needs fewer president and a new budget 'tsar' if it is to emerge from its current economic and political crisis, Finnish Europe minister Alexander Stubb has said. He also explains how Finns were shocked by Greek behaviour.

Latest News

  1. Borrell: 'Israel provoking famine', urges more aid access
  2. Europol: Israel-Gaza galvanising Jihadist recruitment in Europe
  3. EU to agree Israeli-settler blacklist, Borrell says
  4. EU ministers keen to use Russian profits for Ukraine ammo
  5. Call to change EIB defence spending rules hits scepticism
  6. Potential legal avenues to prosecute Navalny's killers
  7. EU summit, Gaza, Ukraine, reforms in focus this WEEK
  8. The present and future dystopia of political micro-targeting ads

Stakeholders' Highlights

  1. Nordic Council of MinistersJoin the Nordic Food Systems Takeover at COP28
  2. Nordic Council of MinistersHow women and men are affected differently by climate policy
  3. Nordic Council of MinistersArtist Jessie Kleemann at Nordic pavilion during UN climate summit COP28
  4. Nordic Council of MinistersCOP28: Gathering Nordic and global experts to put food and health on the agenda
  5. Friedrich Naumann FoundationPoems of Liberty – Call for Submission “Human Rights in Inhume War”: 250€ honorary fee for selected poems
  6. World BankWorld Bank report: How to create a future where the rewards of technology benefit all levels of society?

Join EUobserver

EU news that matters

Join us