Neither Greece, nor the International Monetary Fund (IMF) want to delay the completion of the country’s first program review, Prime Minister Alexis Tsipras and the Fund’s head Christine Lagarde agreed during a meeting in Davos on Thursday.
According to the prime minister’s office, Tsipras and Lagarde agreed that the government and the IMF should have direct communication so that each side has a clear understanding of each other’s position.
The prime minister also briefed Lagarde on the audits conducted by Greek authorities for possible tax evaders who have bank counts abroad, noting it is the first time that there is political will to investigate those cases and not cover them up. Finally, he said the government is hoping to collect a significant part of this money by introducing a legislation of “self-reporting”.
Following the meeting, the IMF issued a press release saying that it stands ready to continue to support Greece in achieving robust economic growth and sustainable public finances through a credible and comprehensive medium-term economic programme, but only if it was granted “significant” debt relief by its European partners.
Earlier, Tsipras said during a panel discussion that solving Europe’s problems required “more Europe”.
“We are doing what we can in order to progress quickly and smoothly with the implementation of the agreement,” he said, and expressed hope that the disagreements and different views that occasionally arose between the three institutions representing the country’s creditors would not be the cause of further delays.
“This is not the time for various ‘exits’, whether these concern ‘Grexit’ or ‘Brexit’, or for divisions, or walls, or differentiations,” the Greek premier continued. “It is a time for more Europe: Common rules, deepening democracy, strengthening solidarity, an increased European budget in order to restrict inequalities, banking union with a European system for guaranteeing deposits,” he added.
According to Tsipras, it was time for Europe to return to its founding principles, which were those of democracy, solidarity and social cohesion.
Addressing issues raised by German Finance Minister Wolfgang Schaeuble, who said the International Monetary Fund’s presence in the Greek programme was essential and compared asking German lawmakers to sanction its removal to “going into a room full of dynamite with a lit candle”, Tsipras made the following comment:
“I too am no supporter of the view that one should attempt to light a candle in a room full of dynamite. Neither, however, do I have the view that on this account one must constantly be in the dark. The best solution is to remove the dynamite from the room and then light the candle.”
25 lawmakers announced their move in a letter to Parliament on Friday morning in Athens, hours after Alexis Tsipras resigned and called an early election to deal with a rebellion in Syriza over his signing Greece’s third bailout deal and accepting austerity measures demanded by creditors. Among the 25 former Greek MPs are not Zoe Konstantopoulou, the President of the Greek Parliament, who has strongly opposed the Memorandum agreement of the Prime Minister nor is the Popular Yianis Varoufakis
The new group, which will be called Popular Unity and will be led by former energy minister Panagiotis Lafazanis, becomes the third largest group in the Greek Parliament.
That means it could potentially receive the mandate to try to form a new government, although, it is not a party that has gone through national elections’ round yet, which might not allow them to get the mandate at all, professors of Constitutional Law said to the Greek media today
Having been catapulted to power after years of oppositions to Greece’s bailouts — which come paired with austerity and structural reform packages — the remaining members of Syriza now find themselves tasked with implementing one, the businessinsider commented.
But, still, It still looks quite likely that Tsipras will be Prime Minister in two months,BI’s article assessed.
Syriza remains popular in comparison to the alternatives. After getting 27.8% of the vote in the January election, the centre-right New Democracy party now regularly polls below 20%.
It’s possible that Tsipras will have to form a new and different coalition, the BI article assumes, but seems that there will be no alternative bloc in parliament to build a majority around. It’s not clear for the moment, how much support Popular Unity might sap from Syriza.
HSBC, Metron Analysis
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Euro zone countries tried in vain to stop the IMF publishing a gloomy analysis of Greece’s debt burden which the leftist government says vindicates its call to voters to reject bailout terms, sources familiar with the situation said on Friday to Reuters, as its exclusive report wrote
The Europeans were also concerned, the Reuters exclusive artcle further reveals, that
the report could distract attention from a view they share with the IMF that the Tsipras government, in the five months since it was elected, has wrecked a fragile economy that was just starting to recover.
“It wasn’t an easy decision,” an IMF source involved in the debate over publication said. “We are not living in an ivory tower here. But the EU has to understand that not everything can be decided based on their own imperatives.”
The board had considered all arguments, including the risk that the document would be politicized, but the prevailing view was that
all the evidence and figures should be laid out transparently before the referendum.
“Facts are stubborn. You can’t hide the facts because they may be exploited,” the IMF source said.
The document released in Washington on Thursday said Greece’s public finances will not be sustainable without substantial debt relief, possibly including write-offs by European partners of loans guaranteed by taxpayers.
It also said Greece will need at least 50 billion euros in additional aid over the next three years to keep itself afloat.
Publication of the draft Debt Sustainability Analysis laid bare a dispute between Brussels and the Washington-based global lender that has been simmering behind closed doors for months.
Greek Prime Minister Alexis Tsipras cited the report in a televised appeal to voters on Friday to say ‘No’ to the proposed austerity terms, which have anyway expired since talks broke down and Athens defaulted on an IMF loan this week.
It was not clear whether an arcane IMF document would influence a cliffhanger poll in which Greece’s future in the euro zone is at stake with banks closed, cash withdrawals rationed and commerce seizing up.
“Yesterday an event of major political importance happened,” Tsipras said. “The IMF published a report on Greece’s economy which is a great vindication for the Greek government as it confirms the obvious – that Greek debt is not sustainable.”
At a meeting on the International Monetary Fund’s board on Wednesday, European members questioned the timing of the report which IMF management proposed at short notice releasing three days before Sunday’s crucial referendum that may determine the country’s future in the euro zone, the sources said.
There was no vote but the Europeans were heavily outnumbered and the United States, the strongest voice in the IMF, was in favor of publication, the sources said.
In Brussels, the way the IMF communicated the findings was seen as confusing, misleading and politically unhelpful.
The European Commission had produced its own debt sustainability analysis, based partially on IMF data, which is less pessimistic in its scenarios and is one of the documents mentioned on the Greek referendum ballot paper.
Diplomats said the IMF’s publication of the study was a way of making clear it would only be part of any future loan pact with Greece if the Europeans included debt relief in the mix.
Germany and its north European allies have said the IMF’s presence is indispensable both to win parliamentary backing for aid for any euro zone partner, and to keep the European institutions honest. Berlin suspects the European Commission of being too soft on Greek efforts to wriggle out of reforms of pensions, taxation, public sector wages and labor law.
The European Central Bank, ( which has made Banks close in Greece as soon as the referendum was announced , we note) the third partner in what used to be called the “troika” of bailout enforcers, is also keen to keep the IMF involved, the Reuters article writes.
ST. PETERSBURG: Greek Prime Minister Alexis Tsipras met with Russian President Vladimir Putin Friday evening in St. Petersburg but the question of Russian financial aid for Greece was not discussed, Putin’s spokesman said, the Associated Press wrote
Tsipras had traveled to Russia as his country struggles to reach a deal with its creditors for new loans it needs to avoid defaulting on debt payments at the end of the month. Without the bailout, Greece could be headed for bankruptcy or an exit from the 19-nation eurozone.
Tsipras’ visit gave rise to speculation that the Greeks may be seeking Russian loans – and ahead of the talks, Putin’s spokesman said Russia would consider a loan if the Greeks asked for one.
“We would do this because they are our partners and this is a normal practice between countries who are partners,” spokesman Dmitry Peskov told The Associated Press.
But when Tsipras met with Putin, the possibility of a loan “wasn’t discussed,” Peskov told journalists. Instead, they spoke about “the necessity of developing investment cooperation.”
Putin, Tsipras laud BRICS cooperation
Russian President Vladimir Putin, Greek Prime Minister Alexis Tsipras, Chinese Vice Premier Zhang Gaoli, among the many speakers at a Russian economic summit on Friday, spoke about ways to boost international trade, bolster global economic growth and the strengthening of the BRICS bloc.The BRICS capitals share key economic interests and oppose what they claim to be a US-dominated world order.
Greek Premier Alexis Tsipras noted that “economic centers of the world are shifting”.
“The economic center of the planet has shifted. There are new emerging forces that are playing a more important role geopolitically and economically. International relations are more and more characterized by multi-polarity,” said Tsipras.
“Enhanced cooperation among the BRICS countries is another manifestation of the new world order at the moment,” he added.
PM Tsipras: The problem is not Greek but European
“We are in the middle of a storm, but we are people of the sea and we are not afraid of sailing in open seas and reaching safe ports,”
Russia willing to consider loans for Greece, officialy stated
Tsipras’s visit has given rise to speculation that the Greeks may be seeking Russian loans. He meets with Russian President Vladimir Putin later Friday.
“We will support any decision [on the Greek debt crisis] that is proposed by Greece and our European partners,” Deputy Prime Minister Arkady Dvorkovich said in an interview on RT television, the Tass news agency reported.
“The most important things for us are investment projects and trade with Greece. If financial support is needed, we will consider this question,” he said.
Dvorkovich spoke after Russia and Greece signed a deal Friday to build an extension of a prospective gas pipeline that would carry Russian gas to Europe through Turkey.
Russia promised Greece hundreds of millions of dollars in transit payments yearly if it agreed to build the pipeline. Construction of the pipeline is expected to start next year and be completed in 2019.
Putin’s spokesman said it was too early to comment on possible loans.
“To consider such a question, you first have to hear some kind of proposals or initiatives from our Greek partners,” spokesman Dmitry Peskov told journalists. “To discuss this abstractly, without having any appeals or proposals, would be shortsighted”
Russia Could Come to Greece’s Rescue. That’s Bad News for the United States and NATO, Foreign Policy wrote hours earlier
Ahead of the Friday meeting, Russian Deputy Prime Minister Arkady Dvorkovich said he “cannot comment on specific decisions” when asked if Moscow would rescue Athens.
This puts German Chancellor Angela Merkel into a difficult spot. Her own conservative party, the German people, and bankers in Frankfurt have all made clear they don’t want to continue to pay for Greece if Athens doesn’t heed calls to reform. But she’s under pressure from Washington to maintain an alliance that won’t upset the apple cart when it comes to sanctions.
“She doesn’t love the idea that Putin would be presented with a gift if Greece is alienated from Western Europe,” Mallaby said
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Yianis Varoufakis launched on air today on his personal blog Greece’s official proposals to thte last Eurogroup, urging readers to judge themselves “whether the Greek government’s proposals constitute a basis for agreement”, and answering this way to the “malicious leaks” and misinformation as he said, by plain “transparency ” (and it was not the first time the minister hmself, had to write down the Greece’s truth, word by word)
According to Brussels’ sources, Lagarde introduced herself on the June 18 eurogroup meeting to Varoufakis saying: “the criminal in chief comes to say hello”, referring to Prime Minister’s speech in Parliament couple of days earlier.
To make the bitter moments Greece is going through on the last days, a bit juicier, enjoy the most juicy tweet posted on these 24h on Yianis-Chrisitne “love-or-hate affair”
The only antidote to propaganda and malicious ‘leaks’ is transparency. After so much disinformation on my presentation at the Eurogroup of the Greek government’s position, the only response is to post the precise words uttered within. Read them and judge for yourselves whether the Greek government’s proposals constitute a basis for agreement.
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