Back to Reality: Greece Takes Up Talks With Troika, Cash Runs Out

ATHENS – With time running out again, Greece’s coalition government, which has done almost nothing since getting a bailout extension, is going into a furious mode trying to reach a deal to bring in money with the country’s cash running out.

Technical teams for the coalition led by Prime Minister and Radical Left SYRIZA leader Alexis Tsipras and the troika of the European Union-International Monetary Fund-European Centrakl Bank (EU-IMF-ECB) were expected to buckle down on April 13 and resume work after the Easter holiday break.

The government is looking for a breakthrough by an April 24 meeting of Eurozone officials, hoping to get release of a delayed 7.2-billion euro installment although it has failed to make a single major reform since getting the extension on Feb. 20.

Criticism has grown that Greece continues to present vague outlines instead of specific reforms with fiscal targets while having its hand out asking for money that Tsipras said he would never accept.

The troika is pressing Tsipras to impose more of the same kind of austerity that brought down two previous governments while his former opposition to big pay cuts, tax hikes, slashed pensions and worker firings elevated him to victory in Jan. 25 snap elections.

Kathimerini said that during an April 8 meeting Greece’s representative, Finance Ministry General Secretary Nikos Theocharakis, told his counterparts there’s likely no money left after April 24 to pay salaries and pensions. The government has already stopped paying its bills.

Finance Minister Yanis Varoufakis said a deal will be reached soon even though he said he had been deliberatey practicing “constructive ambiguity,” in his dealings with the troika.

“I am very confident,” he told Bloomberg TV. “The negotiations are proceeding quite well. It is in our mutual interest to strike a deal by the 24th, and I’m sure we will.”

Varoufakis suggested that the coalition is ready to compromise but that it would not give in on everything.

“We wouldn’t be fit for the purpose if we were not prepared to take the political costs which are necessary to stabilize Greece and lead it to growth,” he said. “But let me be very precise on this, we are prepared to make all sorts of compromises, we are not prepared to be compromised.”

Greece on April 9 paid 448 million euros in an installment owed the IMF and is due to pay another 747 million euros on May 12 as the country struggles to repay 240 billion euros ($260 billion) it has taken since 2010 to keep the economy from collapsing.

IMF Managing Director Christine Lagarde admitted that deliberations between Greece and the institutions had been “difficult on almost a daily basis” and said it is vital that constructive steps are made now to ensure “Greece has full sovereignty over its economic fate.”

“I think what really matters now is for Greece and the three institutions to get on with the work so we can identify together the measures that will take Greece out of the very bad economic situation it could be in if those measures are not taken,” she said.

Lagarde added that a failure to reach an agreement and a potential default and euro exit for Greece would be much worse for the Greeks than the rest of the Eurozone.

“It would be a terrible situation for the Greek people,” she told CNBC. “Equally, I think that the firewalls, the banking union, the strengthened fiscal union have put the Eurozone in a much better and stronger position than were it was four years ago.”

Tsipras had been relying on his bet that the troika would capitulate if he forced it to make a choice that would push the country out of the Eurozone but the lenders haven’t bit yet.