On Tuesday, March 24, it was reported that the European Central Bank (ECB) has decided to apply stricter measures in Greece’s case. The ECB was supposed to officially ban Greek banks from increasing their holdings of Greek sovereign debt, trying to break the link between the banks and the debt-ridden Greek government.
Such a move would of course put great pressure on the country that is allegedly going to run out of cash early next month. ECB President Mario Draghi denied the accusation that the ECB was blackmailing Greece and putting even more pressure on the country.
“Let me disagree with you about everything you said,” Draghi told Portuguese lawmaker Marisa Matias during a hearing at the European Parliament in Brussels, responding to a question regarding the withdrawal of a waiver that allowed the ECB to accept Greece’s debt as collateral.
“It’s a bit rich when you look at our exposure to Greece which totals 104 billion euros. What sort of blackmail is this? We haven’t created any rule for Greece, rules were in place and they’ve been applied,” he said to the European Parliament on Monday.
The ECB is slowly becoming the chief disciplinarian among Greece’s three main creditors. It has rejected the pleas to increase the issuance of Greek treasury bills and resume lending to the country as before. ECB’s stance was criticized by the Greek government who claimed that the central bank is asphyxiating the country.
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