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Rising concerns about Greece

As summed up by The Daily Telegraph, tensions between Greece and the International Monetary Fund have reignited concerns about Greece’s third €86 billion bailout, with the IMF and the EU unable to agree on budget targets needed to get the Greek economy back on track. The milestone of the Eurogroup on 20 February for the completion of the second review is considered lost and uncertainty over the Greek economy increases, Kathimerini further reports.

Speaking at the European Parliament, Eurogroup President Jeroen Dijsselbloem indeed announced, as reported by sources such as Il Sole 24 Ore, Diário de Notícias, Philenews and Sigmalive, that the review of the third financial rescue plan for Greece would not be completed before the next Eurogroup meeting scheduled on 20 February in Brussels. Greece will go bankrupt if the IMF withdraws its support, Jeroen Dijsselbloem said Tuesday in Dutch Parliament, answering a question by MP Arnold Merkies (SP), Het Financieele Dagblad reports. The disagreements are such, that it is not certain that Commissioner Moscovici will find a solution before the next Eurogroup summit, Libération notes.

In an interview with Parapolitika FM, Head of the European Commission Representation in Greece, Panos Carvounis underlines, that the Commission has undertaken the role of the mediator in order to find a solution that will satisfy all sides. Referring to Commissioner Moscovici’s visit to Greece today, Mr Carvounis stresses that the Commissioner supports Greece, the visit being an effort to assist to the review completion. Panos Carvounis, adds, insists on the fact that Mr Moscovici is a politician devoted to maintaining the eurozone’s integrity and Greece’s position in it. A Libération headline actually reads: “Moscovici as Greek negotiator.” Mr Carvounis further tells Parapolitika FM that the Commission focuses its efforts on closing as many fronts as possible until 20 February, so that the Eurogroup can send a positive signal on Greece’s course.

Speaking before the European Parliament during a discussion on the Greek programme, Vice-President Dombrovskis also expressed confidence, that a deal on the country’s second evaluation is still possible, Greek and Cypriot media note. In an interview with Handelsblatt, Vice-President Dombrovskis actually implores the IMF to remain on board for the third aid programme for Greece. Mr Dombrovskis says that the IMF has a much bleaker outlook for Greece’s finances than the EU does. Being of the opinion that Greece has done “almost everything” in order to complete the third programme, Mr Dombrovskis notes that discussions are ongoing, on whether worst-case scenarios must be defined for the use of emergency measures.

Mr Dombrovskis has commended Athens for implementing almost 200 individual reform measures, MDR recalls, noting that while he finds that Greece “has come a long way,” Germany’s Finance Minister Wolfgang Schäuble has again taken the opposite stance, saying that Greece will not be allowed to delay reform in the long run.

Some voices criticising Mr Schäuble are emerging, with MEP Udo Bollmann (S&D) for instance questioning how informed Mr Schäuble is of the actual economic situation, accusing him of using Greece for the election campaign in Germany.

French Prime Minister Bernard Cazeneuve, Les Echos reports, has taken advantage of his visit to Berlin, to talk to Chancellor Merkel about retaining Greece in the eurozone. Mr Cazeneuve made a public announcement, highlighting the importance of “preserving the eurozone in its whole.” For Mr Cazeneuve, “history can be tragic, therefore there is a high-responsibility requirement towards ourselves.” Germany and France have to concretely prove that Europe can bring solution to its citizens, whether it is about the economy, the terrorist threat or defence matters, Mr Cazeneuve said.

In a guest article for Bild Zeitung from Germany, Greek Minister of Finance Euclid Tsakalotos defends the progress his country has made with structural reforms. While he acknowledges the demands from Germany’s Finance Minister Schäuble and the IMF for additional reforms, Mr Tsakalotos states that this is a separate matter from those that have already been passed. Mr Tsakalotos proudly refers to Greece’s commitment to the reform process and says, that while 2017 will be a difficult year, a fair compromise with Greece on social and fiscal policy would go a long way. Parts of the demands from the International Monetary Fund and eurozone institutions, the Wall Street Journal Europe adds, are being resisted by Alexis Tsipras’ government, a move which will mean that negotiations are likely to drag on for weeks, and potentially months, before Athens gets fresh money from Europe’s bailout fund to repay the heavy debts falling due in July.


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