ATHENS – Without consulting the country’s international lenders, Greek Prime Minister and Radical Left SYRIZA leader Alexis Tsipras has sent Parliament four bills designed to alleviate the effects of austerity.
That has raised concern from fellow European Union officials who said he promised to check with them first because he agreed not to implement any aide for Greeks that would affect the country’s ability to meet fiscal targets as part of a four-month bailout extension.
“We have not discussed anything with the Greek side,” a European official told Sunday’s Kathimerini after Tsipras said the legislation would go to the Parliament his coalition, which includes the Independent Greeks (ANEL) controls with 162 of 300 votes.
In a televised address to his cabinet, Tsipras said the measures would tackle the social impact of the crisis, introduce a new payment scheme for overdue debts to the state, to protect primary residences from foreclosures and to reopen public broadcaster ERT even though a replacement station, NERIT, had taken its place.
At a meeting of Eurozone officials on Feb. 20, Greece and its lenders, The Institutions formerly known as the Troika of the European Union-International Monetary Fund-European Central Bank (EU-IMF-ECB) agreed that the government would not adopt any measures unilaterally that “would negatively impact fiscal targets, economic recovery or financial stability, as assessed by the institutions.”
It wasn’t clear if the four bills feel under that caveat but just sending them was said to have ruffled some feathers in the Eurozone after Tsipras was forced to submit and backtrack on a raft of campaign promises, including that he would never negotiate with the lenders but only with EU officials directly. He reneged.
But the government is caught in a cash squeeze and it wasn’t clear how he would implement the new measures and still meet fiscal targets as tax revenues have plummeted and the cost of borrowing in the markets has become prohibitive because of the political instability.
Greece has to repay the IMF some 1.6 billion euros this month and Finance Minister Yanis Varoufakis said he woudl try to negotiate the summer payment of 6.7 billion euros’ worth of Greek bonds held by the ECB.
“Shouldn’t we negotiate this? We will fight it,” he told Skai TV. “If we had the money we would pay… they know we don’t have it.”
Greece’s lenders, however, believe that they may be able to use this inability to pay to their advantage and pressure the government to carry out reforms before the country’s funding needs become less significant.
“Now is the time that we can exercise pressure on the Greek government,” a European official told Kathimerini.