The sticking point in Greece’s negotiations with its creditors was not Athens’ unwillingness to carry out economic reforms but the creditors’ insistence on even greater austerity that would impede economic recovery, Greece’s Finance Minister Yanis Varoufakis wrote in an opinion piece published on the “Project Syndicate” website on Monday.
“The problem is simple: Greece’s creditors insist on even greater austerity for this year and beyond – an approach that would impede recovery, obstruct growth, worsen the debt-deflationary cycle, and, in the end, erode Greeks’ willingness and ability to see through the reform agenda that the country so desperately needs. Our government cannot – and will not – accept a cure that has proven itself over five long years to be worse than the disease,” Varoufakis said in the article entitedl “Austerity is the only deal-breaker”.
Contrary to what he called the “fallacy” pervading coverage of the negotiations in the media, Varoufakis stressed that Athens “is keen to implement an agenda that includes all of the economic reforms emphasized by European economic think tanks,” and able to maintain public support for such a programme.
The demands of Greece’s creditors, by contrast, called for “unsustainably high primary surpluses” that were to be achieved by imposing higher taxes and more fiscal consolidation. Calling the idea that Greece had not achieved sufficient fiscal consolidation “patently absurd”, Varoufakis suggested that Greece’s programme had failed compared to that of other bailout countries precisely because it was subjected to a “double dose” of austerity.
(source: ana-mpa)
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