Greece ready for hard bargaining with lenders

Greece ready for hard bargaining with lenders

Greece ready for hard bargaining with lenders

A new wax figure of French President Hollande (C) is pictured between wax models of German Chancellor Merkel (L) and British PM David Cameron at Madame Tussauds. AFP photo

The pressure on Greece continues to grow ahead of crucial talks on the fate of the debt-ridden country as Prime Minister Antonis Samaras seeks more time to implement measures urged by its lenders. 

On the eve of successive talks with German Chancellor Angela Merkel today and French President François Hollande tomorrow, a war of words is also heating up with Samaras saying a Greek euro exit would start a devastating domino effect even as Germany’s hard-line finance minister is trying to squeeze the Aegean country in terms of timing.

Samaras was quoted yesterday in an interview in France’s Le Monde as saying the government could cash in on uninhabited islands. Samaras said, as interpreted by the Associated Press, that investment was key to reviving the economy and that privatization plans included selling railways and a part of the Attica coast.

Asked if the government was ready to sell uninhabited islands too, he said, “As long as this doesn’t pose problems for national security, some of these isles could have a commercial use.”
Earlier this week, Samaras said Greece was not seeking any write-off or further funding, but extra time, or “breathing space,” in his own words. 

However, German Finance Minister Wolfgang Schaeuble wasted no time in responding, telling public radio yesterday that giving Greece more time to implement necessary structural reforms would not solve its severe problems.

“More time is not a solution to the problems,” Schaeuble told SWR radio.

“More time would, in case of doubt, mean more money,” and the eurozone already went to its very limits in hammering out the deal with Athens last year, the minister said, according to Agence France-Presse.

It was not an issue “of being more generous or less generous” but about finding a way for the eurozone as a whole to regain the confidence of the financial markets, Schaeuble said. 

As part of a rescue package with its international creditors, Greece has committed to slashing some 11.5 billion euros ($14.2 billion) from spending over two years from 2013.

Samaras reportedly wants to discuss extending that period to four years in his talks in Berlin and in Paris.

Berlin has insisted that there can be no wiggle room for Greece either in terms of the substance of the reforms and cuts it must make or in terms of the time it takes to achieve them.
A team of auditors from the so-called Troika – the European Commission, International Monetary Fund and the European Central Bank – is due to report next month on whether Greece has done enough to unlock a further tranche of aid to stave off bankruptcy.

Merkel wants Europe

Merkel launched a campaign yesterday to persuade citizens of the benefits of European unity, as polls show rising euroskepticism in the continent’s top economy amid the near three-year crisis.

Merkel kicked off the new campaign, called “I want Europe,” with a video message extolling the virtues of European cooperation, saying it had brought “peace, prosperity and understanding with our neighbors.” 

“We are living through one of Europe’s worst crises. This crisis has built up over many years and will therefore take a long time to overcome. It will be difficult. But I am deeply convinced that at the end of this path, we will have a sustainable and strengthened eurozone and European Union,” said Merkel.

“I want Europe” brings together politicians past and present including the country’s President Joachim Gauck, Merkel and former chancellor Helmut Schmidt, with celebrities including German football captain Philipp Lahm.

Merkel and Hollande were scheduled to head to Greece after the Hürriyet Daily News went to print yesterday evening. “It is about Europe as a whole this week, this is the spirit that guides me in my talks with the French president,” Merkel said a day earlier.

After meeting Samaras on Aug. 22, Eurogroup chief Jean-Claude Juncker insisted Greece’s place was in the 17-nation eurozone but urged its government to redouble reform efforts to secure continued EU-IMF financial aid.

Juncker said Greece was staring at its “last chance” to avoid bankruptcy.