We are one step before the conclusion of Greece's second bailout review. The latest Eurogroup in Malta last Friday brought a mixed agreement, with positive and negative aspects, but on this we should add concrete mid-term debt relief measures and reasonable primary surpluses. This full package will signal the final conclusion of the bailout review, accelerate the release of the bailout tranche, and include Greece into ECB’s quantitative easing program, paving the way for the final exit from austerity programs.
The German Finance Minister Mr Schauble failed to pass his extreme demands for further austerity due to the stance of the German social democrats, the Left and the Greens, that have been standing firm and supporting the Greek government, but also as a result of the fruitful discussion between PM Tsipras and Chancellor Merkel the day before Malta’s Eurogroup was convened. All sides have acknowledged the threats posed by a no-solution on the Greek issue, and now it is time for the IMF to agree, along with Germany, on the mid-term debt relief measures, according to the agreement of July 2015. So far, the IMF has been reluctant to respect the European acquis, pushing for the complete dismantling of labor rights and the labor market.
Most of the creditors are convinced of the great efforts the Greek government has made these couple of years to accelerate reforms, put the economy back on track, decrease unemployment, address corruption, cronyism and mismanagement. To that end, fiscal performance has been outstanding and primary surplus exceeded by far the agreed targets. All these have been achieved after the sacrifices and patience of the Greek people.
The coming period is crucial for Greece, EU and Eurozone. The geopolitical uncertainty and the belligerent rhetoric of the Turkish leadership, the turmoil in the Balkans, the terrorist attacks in Europe, the surge of populist and far-right parties, the unreliable policy of President Trump and the confusing Brexit process increase instability and bring Brussels and national leaderships in front of big dilemmas. In this context, Greece is and should remain a pillar of stability, fostering commercial, energy and economic partnership in the Eastern Mediterranean, working on accommodating refugees and migrants and creating safety nets for the Greek society, enhancing synergies with progressive political forces in the EU towards shifting the agenda to pro-growth and inclusive policies.
The final conclusion of the bailout review should take place in May, based on what has been agreed by all involving parts, in compliance with the national and collective interest of Greece and EU. Further delays by the creditors will be very harmful, feeding these forces that want the dissolution of EU and the dismantling of social and economic cohesion.
12.4.2017
