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Greek Government Buys Some Time Again

greece_mini_summit_2015On February 20, Greece and its European partners decided to move forward by agreeing that the new government will implement much-needed reforms in exchange of the continuation of financial aid.
On March 20, Greece and its European partners decided to move forward by agreeing that the new government will proceed with reforms in exchange for more financial aid.
This time though, Prime Minister Alexis Tsipras promised European partners that the Greek side will cooperate with the teams of experts who come to Greece to monitor the progress of reforms. It was about time, as some of them claim that they were not getting the data they needed from the Greek team and some went to the extent of saying that they received death threats while in Athens.
One wonders if on April 20 Athens will call top European officials on a new emergency meeting asking for clarification on what exactly was decided on the previous two agreements and how exactly the lenders’ representatives will operate while in Greece.
A whole month was lost in arguing over what to call the representatives of the institutions that would come to Greece to monitor the progress of the reforms or what to call the new loan the government is asking to stay afloat. Or debating what reforms should be first on the list.
Meanwhile, depositors in Greece are withdrawing their savings as if Armageddon is at the gates. More than 20 billion euros have fled from Greek banks to God knows where. Probably under mattresses or in portable strong boxes. Payments for state debts or bank loans have also stopped. Liquidity has frozen.
There’s plenty of liquidity in promises though. Promises to end the crisis, for growth, solidarity, dignity, pride and, of course, change.
Today, Greek Prime Minister Alexis Tsipras stated that there is no short-term liquidity problem. He didn’t specify how short the short-term is though. Time is relative, after all, for those who believe in creative vagueness.
When asked when Greece will come ahead with the proposed measures, Tsipras said that deadlines put unnecessary pressure on people and should be avoided. Despite Angela Merkel’s insistence that money will follow reforms, not the other way around.
Nevertheless, Tsipras has managed to win some time for the Greek government to come up with a list of reforms and present it on time, before partners lose their patience again. And, hopefully, before bankruptcy.
Yet, the Greek prime minister scored a victory yesterday in Brussels. Not only did he manage to get the European Commission President Jean-Claude Juncker to admit that there is a humanitarian crisis in Greece caused by austerity measures, but he also got him to allocate two billion euros for tackling the humanitarian crisis. And that money will not be part of the bailout program. He should get kudos for that.
Kicking the can down the road is a policy favored by Greek politicians, both seasoned and rookies. The new government has learned quickly on how to play the game of procrastination. And it’s doing a great job so far.
 

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