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25/02 – Greece backs down to secure bailout

All newspapers report that euro area finance ministers on Tuesday approved Greece’s plan meant to ease the hardships created by its international bailout, thus securing a four-month extension of the bailout programme. Greece’s plan includes some measures to tackle the humanitarian crisis that were a part of Syriza’s electoral campaign, like a pledge to fight tax evasion, smuggling and corruption to recoup €7 billion, as well as to reduce the costs of public administration.

The EC, ECB and IMF called the proposals “sufficiently comprehensive to be a valid starting point” and Eurogroup President Jeroen Dijsselbloem said the Greek government was “very serious” about meeting its reform commitments; yet both the ECB and the IMF have shown some scepticism over whether Greece will be able to stick to the agreement. According to Ta Nea, Angela Merkel commented that the Greek government is becoming more and more realistic, though emphasising that the work is not over and more discussions for Greece will be needed. For his part, Mr Schäuble said that the programme must be first fulfilled before the Greeks get any money.

According to The Times, Commissioner Moscovici said the agreement had “averted an immediate crisis”, but added: “It does not mean we approve those reforms, it means the approach is serious enough for further discussion”. In an interview with French BFM TV, he deemed what has been decided “a first gesture of confidence,” adding that “building trust is a step by step process, and now acts must follow.” Ta Nea adds he said the EC was “ready to help, discuss and provide technical assistance,” provided Greece finds a way to revive growth. He also highlighted that tackling tax evasion was an absolute priority, and that there were no other working scenario in the Commission aside that of Greece staying in the euro area.

Cerstin Gammelin writes in SZ that the European Commission played a major role in brokering a last-minute deal between the “inexperienced” Greek government and euro area partners, and an EU diplomat noted that without Mr Juncker’s interventions, Athens would not have asked for an extension. El País comments that the green light came along with a good number of reservations being raised, adding that the document presented by the executive of Alexis Tsipras is a “poorly detailed roadmap failing to include the costs or savings of the measures”. “I have never seen support given with so many caveats,” claimed Spain’s finance minister Luis de Guindos.

El Mundo‘s lead writer says the troika’s thumbs-up has allowed the Greek PM to save face before his voters and avert a chasm within his party that would have added further difficulties to Greece’s situation. However, although Mr Tsipras may well be able to sell to the Greek people that he is retaining the major portion of his measures against the country’s “humanitarian crisis,” the newspaper states, in practice he has been forced to moderate or even give up on many of his election promises. France 3 also says that these reforms are “far from corresponding to the election promises” of the radical left in power, and ABC speaks of a “climbdown” on populist pledges made by PM Alexis Tsipras.

FAZ reports that along with other opposition party politicians, Chairperson of the Greek Pasok party Evangelos Venizelos staunchly criticised that the ruling Syriza party has broken its campaign promises, denouncing the “humiliation” that the Syriza party itself underwent. “One month of drama, three Eurogroups and a European Council meeting later, the Greek government eventually gave in to its creditors’ demands”, Libération‘s Jean Quatremer comments, adding that “the negotiation is far from over”. It is a “bumpy return to reality” for Greece, which finds itself isolated in Europe, in a “disastrous financial situation”, and failed to use the threat of a Grexit to its advantage, Mr Quatremer sums up, adding that Greece will remain unable to stand on its own two feet for quite some time.

Economist Ricardo Arroja says in Diario economico that Europe is not seeking a long-term deal, it is playing to see who will make Greece leave the Euro, adding that while both sides would lose in this game, theoretically Greece would be the main loser. Yet as Greece seems to have convinced Europe otherwise, it is a true victory. Eurogroup President Jeroen Dijsselbloem said that a further financial support will be evaluated after the summer, if Greece abides by its commitments.

Corriere della Sera specifies that the parliaments of Germany, Finland, Netherlands and Slovenia still need to approve the bailout extension, though several newspapers mention that it should be a formality. Greek PM Alexis Tsipras and Finance Minister Yanis Varoufakis have until the end of April to flesh out their reform proposals, which still lack concrete figures. Le Monde’s editorial concludes that if Tsipras succeeds in routing out corruption and tax evasion in his country, the moment will have arrived for everyone else to support him unconditionally.©europeanunion2015

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