Ex Greek PM Simitis: The Loan Agreement Was A Potically Fatal Mistake

Costas Simitis, Greece’ prime minister that led the country to euro zone, fiercely criticized the authors of the Memorandum of Understanding , the loan agreement singed between Greece and its lenders to enable the debt-ridden country to receive the rescue package of €110 billion in may 2010.

“The agreement between the Greece and it’s lenders about the policy Athens ought to implement in order to be granted all the bailout out tranches, was drafted without adequate preparation,” says Simitis in a speech draft he would be deliver on January 23/2012 at a conference in Germany.

“The authors of the MoU failed to attach their goals to actual developments, ie to predict that if the recession would be extended, the goals would be automatically readjusted. That was a politically fatal mistake. This omission resulted into continuing the original harsh austerity plan, despite the recession that occurred and to extend the recession. “

According to former Greek PM,  the Greek problem was not just a misfortune in the EU course. It was the catalyst that brought up the shortcomings of past economic governance and the need for a new definition.”
 
Costas Simitis blames the authors of the loan agreement and those who concluded it  of “childish mistakes.”  The economic objectives of a program should be linked to the actual developments, Simitis writes in his speech adding that “I t is unprecedented that neither the inspectors of the Troika nor the Greek government were able to predict and prolong the economic targets in case of recession.

Costas Simitis will deliver his speech upcoming Monday in Berlin at a conference titled  “Greece in crisis. Prospects for the European path” organized by the Heinrich Böll Foundation and the Free University of Berlin.