Greek Prime Minister Alexis Tsipras slammed both the International Monetary Fund and the German Finance Minister Wolfgang Schaeuble for their policies leading to delays in the conclusion of the second review of the third bailout program.
Speaking at the central committee meeting of SYRIZA on Saturday, Tsipras said that those who pursue a two speed eurozone are playing with fire. He expressed optimism that the review would be completed positively but reiterated that Athens will not accept “illogical demands by the lenders.”
“We are ready to discuss anything within the framework of the (bailout) agreement and within reason, but not things beyond the framework of the agreement and beyond reason,” Tsipras said. “We will not discuss demands which are not backed up by logic and by numbers,” he said.
Tsipras accused the IMF, with which it has had testy relations since its first bailout in 2010, of being “cowardly,” and of coming up with “new demands for Greece; absurd, imaginary unreal, it doesn’t matter, as long as it is made to look like Greece is to blame … for the already agreed decision of the Fund to not finance the third Greek bailout.”
Further, he accused the IMF of “being afraid to tell its opinion to Schaeuble” thus creating the impression that Greece is to blame for the delays.
The Greek Prime Minister also slammed Finance Minister Wolfgang Schaeuble who has been intensively using “Grexit” in the German elections campaign.
Tsipras said that Schaeuble is using Greece in order to hinder voters from rushing to far-right AfD. He called on Chancellor Angela Merkel to “discourage her finance minister” and compared Schaeuble with the “pyromaniac who plays with the matches in a store full ammunition! ”
“I am sure their own government will not allow the pyromaniacs playing with matches in a store full ammunition,” Tsipras said and added “I want to strongly appeal to Chancellor Merkel to discourage her Finance Minister of this constant aggression against Greece and of the pejorative references. The election campaign in a country can not affect life in another country.
He warned all sides to “be more careful towards a country that has been pillaged and people who have made, and are continuing to make, so many sacrifices in the name of Europe”.
His own estimation is that the IMF will not participate financially in the Greek bailout program.
Greece and its international lenders said they made clear progress on Friday in Brussels where finance minister Tsakalotos met each of the lenders separately. They had a joint meeting in form of an extraordinary and unofficial mini ‘eurogroup.’
According to Greke media, the lenders’ representatives might return to Athens on Monday to assume talks for the conclusion of the second review.
Reaching agreement would release another tranche of funds from it latest 86 billion euro bailout, and facilitate Greece making a major 7.2 billion euro debt repayment this summer.
European and International Monetary Fund lenders want Greece to make 1.8 billion euros – or 1 percent of GDP – worth of new reforms by 2018 and another 1.8 billion euros after then and the measures would be focused on broadening the tax base and on pension cutbacks.
But further cutbacks, particularly to pensions which have already gone through 11 cuts since the start of the crisis in 2010, are hard to sell to a public worn down after years of austerity.
The IMF was said to want initially austerity measures worth 4.9 billion in order to participate in the Greek program.
The IMF has sat on the sidelines of the latest bailout program and says it cannot participate in a program which could keep Greece in a never-ending cycle of indebtedness that could push national borrowing to 275 percent of economic output by 2060.
“I don’t know if (the review) will be completed with the IMF having a central funding role, or a different role, but the review will be completed because Europe cannot afford to play games,” Tsipras said.
“We will not accept games on the back of the Greek people,” and “those playing games in the name of a two-speed eurozone play with fire,” The Greek prime minister added.
PS Odd. Yesterday, ex Greek finance minister Yanis Varoufakis used the same word “coward” for the IMF.
Little (very little) Alex: too late to play resistance against Wolfie and the 4th Reich. They already have you in their pocket and you will do exactly as they say. What you say to (what is left out of) your party is just that: party tricks in poor taste.
Is Tsipras scared to be making such comments? Generally when he resorts to
Personal attacks it means things are going bad. Same as 2015?
It was just a party meeting that needs something but from the reactions – so far – the slamming out of Germoney is really soft, “cowardly IMF” they left out also and more and more media use “up to 86 billion” – last year this only did “derSpiegel” (since when?XaXa) – instead of “86 billion”
But may it’s too loud inside Germoney: Schaeuble slammed Schulz campaigning like Trump…
About Tsipras’ quote: ‘the illogical demands of lenders’.
There is no logic in any of this. Lending Greece more money it can never hope to repay isn’t logical. Expecting more austerity to have any different effect than it has had for the last 7 years is plain stupidity.
Greece needs devaluation. IMF programs are only designed to work with devaluation. There is an interesting article in the FT (paywall, so can’t quote) comparing Greece with all the world’s biggest economic basket cases . . . Argentina, Brazil, Thailand, so on. Post-crisis Greece has underperformed all of them – by a very long way – since it was unable to use the exchange rate tool.
Moreover, Greece has never recovered.
Iceland was devastated by the banks. Yet Iceland exited its IMF program in three years. Today people are wondering if the Krone is too strong.
A return to the Drachma isn’t the only alternative. Italy, Portugal, Cyprus . . . maybe Spain . . . would also benefit from devaluation. There’s a lot of discussion about a return to the Lira in Italy. It’s not a taboo subject in Italy at all.
A ‘Southern Euro’, pegged at say 15% below, would do wonders for all these countries. The best part is that it doesn’t leave one country or currency hanging. There would be no extreme volatility. It’s been discussed before. (I think, originally, the idea came from a German Think Tank.) But of course the idea has never gained traction for ‘political reasons’.
Or in other words, nothing to do with logic.
Southern euro would be a genial solution, the only problem : would the debt of Greece, Italy be denominated in Northern or Southern euro ?
As it is improbable that the debt is going to be repaid, the currency of its denomination perhaps becomes a moot point.
Amongst the likely insurmountable obstacles to a Southern Euro solution (itself a sound idea) is France. Could it ensure the national humiliation of being placed where it ought to be in the Southern Euro? Almost certainly not.
“Improbable” like the 50+ billion already paid back?
Where will be the frontier? In San Sebastian or in Lyon? In Corsica or in Sardinia? In Verona, Firenze, Roma or in Sicily?
“Sardinia non est Italia!” btw
The 15% could be (part of) the debt relief. It has to be discussed. Britain took 60 odd years to pay back the US war loans. And the US did not keep increasing this debt with further ‘loans’.
Besides the nonsense of the arithmetic, It’s a scandal that Greek pensioners are paying to recapitalise banks. M. Lagarde is already talking about another 10bn for the banks in 2018. Iceland put the banksters in jail. No cowards there.
a real scandal is that pensioners from the bank sector did not see ANY cuts in their pensions all these bailout years.
May be the “cowards” should build up militia to defend against the Maniak … Michalis Ignatiou thinks 50/50 are the chances for war:poso-konta-briskomaste-se-ena-polemo-elladas-toyrkias
So if the cowards now will be send home how many arms one need to defend against Turkey that helps the oligarchy and EU, US and IMF blackmailing?
Will then “International Brigades” from Northern Europe come for holidays?
But may be they all believe into the saga of the oil and gas in the Libyan sea and just need to get explained that all attempts to drill 3 miles deep will be brutally answered and hindered by giant octopussies.