Wednesday

12th May 2021

Greek 'truth' committee probes legality of EU bailouts

  • Soldiers outside the Vouli: Konstantopoulou said the probes could expose criminality at a 'very, very high level' (Photo: Barcex)

With Greek leaders in 11th-hour talks on the country’s second bailout, Greek MPs are investigating the legality of the bailouts and whether Greek debt has to be repaid.

A “truth” committee on public debt and a committee for the “memoranda”, the name of the documents which contain the bailout terms, were set up in March and April under the leadership of Zoe Konstantopoulou, the speaker of the Vouli, the Greek parliament.

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  • Konstantopoulou (c), with Sakorafa (l), and Belgian economist Toussaint on the debt truth committee

Their first findings are expected on 18 June.

The probes are complemented by a committee on German World War II reparations and on the return of Greek archeological treasures.

They are also complemented by the reopening, on 1 May, of the Siemens and Lagarde List cases by the Vouli’s committee on institutions and transparency.

The Siemens case involves bribes for Greek officials in exchange for public contracts for the German firm in the 1990s and in the run-up to the 2004 Athens Olympics.

The Lagarde List is a register of tax evaders transmitted to the Greek government by International Monetary Fund (IMF) chief Christine Lagarde in 2010, but never properly investigated.

The various initiatives are designed to delegitmise the austerity measures imposed by Greece’s creditors, the EU - the International Monetary Fund (IMF), and the European Central Bank (ECB) - since 2010.

They are being used as a “bargaining chip” in the bailout talks.

They’re designed to help Syriza heal tensions inside its own ranks, with radical MPs growing more critical of the PM’s, Alexis Tsipras’, concessions.

They are also designed to harm his political opponents, the conservative New Democracy (ND) and the socialist Pasok parties.

The old Greek elite, which has shared power since the country’s return to democracy in 1974, agreed the bailout terms and stands accused of shady relations with Greek oligarchs.

Political bomb

"Greece is not a liegeman whose lenders can play games behind its back," Tsipras said on 7 April, during the vote which set up the memoranda committee.

The memoranda probe could be the most explosive domestically.

It’s looking into the circumstances in which the Pasok government of George Papandreou and the ND-Pasok government of Lucas Papademos signed terms with the troika, a group of EU, IMF and ECB officials.

Konstantopoulou, the Vouli speaker, who used to be human rights lawyer, told EUobserver it could prompt criminal charges.

"The committee will look into possible criminal responsibility for the memoranda regime which has basically victimised the Greek population but also totally destroyed the Greek economy,” she said.

It’s composed of Syriza, ND and Pasok MPs and has already summoned witnesses from Greece’s Public Debt Management Agency, the General Accounting Office, and the Hellenic Statistical Authority.

Some MPs also want to interrogate former Greek finance ministers and international officials, such as former IMF chief Dominique Strauss-Kahn, former ECB president Jean-Claude Trichet, and former EU finance commissioner Olli Rehn.

Truth

The truth committee, despite its name and despite Konstantopoulou’s patronage, is not a formal parliamentary inquiry.

It’s an audit conducted by a group of some 30 experts from civil society, half of whom are Greek and half of whom are foreign.

The committee is comprised of professors of economy, legal experts, senior civil servants, including Belgian economist Eric Toussaint, who heads the international panel in the committee, and former Ecaduor Finance minister Diego Borja.

Ecuador, under president Rafael Correa, ran a similar audit before suspending international repayments in 2008.

"It’s very widely believed, justly believed, that a very big part of what is currently called the [Greek] public debt is illegitimate, illegal, and odious, and, of course, unsustainable”, Konstantopoulou said.

Her vocabulary refers to notions used by global anti-debt activists.

Campaigners say that: if debt harms public interest but favours a minority then it’s illegitimate; if it violates the debtor’s national laws, it’s illegal; that if it violates human rights, it’s odious; and if it can’t be repaid unless it harms fundamental rights, such as the right to healthcare, it’s unsustainable.

Timing

The full audit is to last at least a year.

But a preliminary report will be issued on 18 June, shortly before the end of the current bailout programme, when Tsipras is set to ask for debt restructuring and for new, long-term, assistance.

Patrick Saurin, a French trade unionist on the truth committee, told EUobserver “our work is to identify the four kinds of debt” in Greece.

"The government will quickly have a clear picture and will be able to decide on a debt moratorium or cancellation”.

It prompts the question whether Tsipras will follow Ecuador and use the “truth” report to also stop repayments.

"The government has a mandate to serve the people, so I’m sure it will make good use of the outcome of the works of the committee”, Konstantopoulou said.

Sofia Sakorafa, a Syriza MEP, who helped initiate the audit, told EUobserver it’s “a robust bargaining chip” in Tsipras’ negotiations.

"The committee aims to equip the Greek government with legal arguments on the issue of the removal of the debt”.

Moral high ground

Referring to the mixed bag of Vouli initiatives, Sakorafa added: "clearly, there is a political and moral link" between the probes.

Konstantopoulou said “auditing and decoding the debt [will] serve a fundamental and undeniable right of the people to truth and to justice”.

"It’s very important to … show which part [of the debt] corresponds to which lending agreement or [former] government actions, and to show which deals were concluded not for the public interest, but very often in order to serve corruption at a very, very high level”.

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