Just hours before the meeting between Greek finance minister Yanis Varoufakis with his counterpart Wolfgang Schaeuble in Berlin, and the German side most probably thought to put the agenda of Thursday talks. In a document leaked to the press, Berlin made its positions towards Greece very clear and demands from the new left-wing coalition government to call off all the anti-austerity promises SYRIZA made right after it took office on January 26th 2015 and stick with the economic policies commitments of the previous governments. newly appointed Greek ministers made publicly pledges to halt privatizations, raise minimum wage, give an extra pension to low-pensioners and rehire some fired public sector workers.
Athens answer was quick: Within hours, the office of Prime Minister Alexis Tsipras rejected Berlin’s demands.
“It is obvious that the German proposals will not be accepted by the new Greek government, They are against the recent command given by the Greek people and they do not help the prospect of development in Europe, ” government sources told Greek media, stressing that “the German proposals ask the Greek government to withdraw its anti-austerity commitments and restore the Memorandum!”
“The Eurogroup needs a clear and front-loaded commitment by Greece to ensure full implementation of key reform measures necessary to keep the program on track,” the German document said adding that the aim is the perpetuation of the agreed structural reforms. The German document showed Berlin wants the Troika to remain in place.
Specifically the document calls on Greece
1) to declare it would honor its debt repayment commitments toward the ECB, the IMF, the euro zone bailout fund EFSF as well as bilateral loans from euro zone countries extended to Greece under the first bailout program.
2) to accept the independence of the Greek central bank, the Hellenic Financial Stability Fund that is the capital backstop for Greek banks, as well as the tax and statistics authorities.
3) to reach a primary budget surplus before interest payments of 3 percent of GDP in 2015 and 4.5 percent in 2016, and to close the remaining gap in the 2015 budget to reach the agreed target.
4) to stick to an agreement to reduce general government employment by 150,000, implement pension reforms that establish a close link between contributions and benefits, keep the lowered minimum wage and make wider use of decentralized wage bargaining.
5) to continue privatizations of ports, energy utilities and real estate in particular and fostering foreign direct investment with the aim of getting 2.2 billion euro in revenue in 2015. (full story in REUTERS)
It must have shocked Berlin that SYRIZA and Independent Greeks ministers publicly pledged among others: to halt the privatizations and especially the ones of Piraeus port Authority and Public Power Company, to raise the minimum wage to €751 from €581 currently, to restore the so-called “13th pension” for low-pensioners, scrap patients’ contributions to health access and rehire public sector workers fired just for the sake to meet Troika’s demands.
The official SYRIZA-Independent Greeks coalition program is to be unveiled over upcoming weekend in Greek Parliament.
PS Correct me if wrong, but I have the very slight suspicion that Germany has not taken notice that elections have taken place in Greece and that people voted in a favor of an anti-austerity party and government.