17th Nov 2019

Greece faces criticism, as 'plan B' speculation mounts

  • Tsipras appears to be pinning his hopes on brokering a personal agreement with German chancellor Angela Merkel (Photo: Bundeskanzlerei)

The bitter fallout from Friday’s failed Eurogroup meeting continued over the weekend, with Greece looking increasingly isolated as it desperately seeks a debt deal that will allow it to avoid bankruptcy.

In a tweet posted at the weekend, Finance minister Yanis Varoufakis appeared to allude to the verbal roasting he received on Friday, referring to a statement by US President Franklin D Roosevelt from 1936. ‘They are unanimous in their hate for me; and I welcome their hatred’. A quotation close to my heart (& reality) these days,” he wrote.

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  • 'I welcome their hatred' - Varoufakis appeared to admit that tensions ran high at Friday's Eurogroup meeting in a tweet

Like the rest of Alexis Tsipras’ Syriza-led government, Varoufakis is new to government office, and he was, according to a report by Bloomberg, accused by one minister of being a "time waster and an amateur" during fractious exchanges in Latvian-capital Riga.

The meeting broke up without agreement on an economic reform package that would allow any of the remaining €7.2 billion of Greece’s bailout programme to be paid out.

Friday’s failure makes reaching a deal when finance ministers will next meet on 11 May imperative if Greece is to avoid running out of money. Tsipras appears to be pinning his hopes on brokering a personal agreement with German chancellor Angela Merkel.

But after nearly three months of unsuccessful talks, speculation about whether eurozone partners are preparing for a Greek exit from the eurozone is mounting.

Asked whether there was a plan B, Schaeuble said: "If a responsible member of the Eurogroup, or any responsible politician, were to answer this question with ’yes,’ we know what would happen. If he answered it with ’no,’ which I have done here by not even accepting the question, then we know that you won’t believe me."

Slovenian finance chief Dusan Mramor raised the possibility of a plan B during the meeting itself.

But Syriza parliamentary spokesman Nikos Filis attributed the eurozone’s hostility to fear of Syriza’s anti-austerity platform in remarks on Sunday.

“The issue is essentially political. It’s not only limited to an economic negotiation,” he said. “They don’t want the new Greek government, it doesn’t suit them. They’ve said it openly.”

Meanwhile, eurozone commissioner Valdis Dombrovskis told Germany’s Handelsblatt that the Commission will revise down its growth forecast for Greece this year.

"In winter we expected growth in Greece this year of 2.5 percent. Our spring forecast for Greece will turn out to be more pessimistic," Dombrovskis said.

The Greek treasury expects the country’s economy to grow by 1.4 percent in 2015 - down from its previous forecast of 2.9 percent.

Both Varoufakis and Tsipras’ government as a whole continue to enjoy strong public support, although a majority of Greeks would prefer to strike an agreement that allows it to remain in the eurozone.

Surveys over the weekend suggested that 55 percent of Greeks supported Varoufakis’ stance. However, a Kapa research poll published in the Sunday Vima newspaper showed that 72 percent wanted Greece to strike a deal with its creditors.

For his part, Defence minister Panos Kammenos warned that Greece could be forced to call a referendum if the crisis deepened, telling Mega TV that “in the event that they try to enforce an informal exit on us, a plebiscite could happen”.

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Greece is no closer to agreeing a new deal with its eurozone creditors after the latest round of talks broke up acrimoniously, with one fellow minister describing the meeting as a "complete communication breakdown".

Eurozone chief backs Greek reforms, but says more needed

Eurozone chief Jeroen Dijsselbloem has backed the reforms plan submitted by the Greek government, but warned that measures such as a functioning tax collection system take time and the budget must not go "off-track" in the meantime.


Sidelining Varoufakis is Tsipras' wild card

Isolated in the eurogroup and less popular at home, the Greek finance minister will no longer be in sole command of negotiating with lenders.


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