ATHENS – European Commission President Jose Manuel Barroso, in his first visit to Greece in three years, told new Prime Minister Antonis Samaras that international lenders want results in implementing more reforms if the country wants to keep rescue loans coming and to insure Greece stays in the Eurozone of the 17 countries using the euro as a currency.
Barroso came as officials of the European Union-International Monetary Fund-European Central Bank (EU-IMF-ECB) Troika were also in the capital to check the country’s books and review progress on long-delayed reforms. Greece is surviving on $152 billion in bailout loans from the Troika, which is withholding another $173 billion until Samaras’ new coalition government, that includes his New Democracy Conservatives, the PASOK Socialists and Democratic Left, imposes more austerity and makes another $15 billion in cuts.
Samaras’ two-hour meeting with Barroso came after the Premier and his coalition partners failed to reach agreement on where to make the cuts and adjourned until July 30 to try again. Barroso had a sobering message for him: “deliver, deliver, deliver.” Barroso said, “The main issue is implementation to deliver results.”
“To maintain the trust of European and international partners, delays must end. Words are not enough, actions are much more important than words,” he added. “Greece is part of the euro area and we intend to keep it that way. All the heads of state of the euro area have stated that Greece should stay in the euro as long as commitments are honored,” he said. Barroso said he saw a new willingness by the government to implement the country’s reform agenda. Reforms were set aside this spring as politicians campaigned through two elections after a first failed to yield a government.
Austerity measures demanded by the Troika have worsened a five-year recession, put nearly 1.1 million people out of work, shrunk the economy by 6.7 percent and is closing some 1,000 businesses a week. Barroso said Greece has to grow its way out of disaster. “You must rebuild your country with our help and increase your competitiveness and the best way is within the euro, especially for the most vulnerable groups in society,” he said.
Samaras said his government was determined to push ahead with structural reforms, privatization, fiscal consolidation and a yet another crackdown on tax evasion although countless others have failed as most Greeks refuse to pay taxes. “We will cut public spending at every level from the prime minister’s office to the very last rung of the ladder,” he said, although there were reports the government wants to exempt the special salaries of judges, military officers and protect the pay of priests, whose salary is paid by the government.
Greece does not have money to pay back a 3.5 billion euros, or $4.3 billion, loan installment next month and is seeking a bridge loan to pay the loan. The Troika warned that unless Samaras delivers results that a 31.5 billion euros ($38.7 billion) loan installment Greece needs to pay workers and pensioners could be withheld.
(Sources: MNI, Financial Times, Wall Street Journal, Kathimerini)