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9/02 – Tsipras risks clashing with Europe

Alexis Tsipras’s inaugural speech before the Parliament receives widespread coverage in today’s European press. “Tsipras takes the risk of clashing with Europe”, reads Les Echos. Despite the frosty welcome he got from his European partners last week, Alexis Tsipras is not deviating from his intentions and refuses to deal with the troika and wants to negotiate a new deal with his country’s creditors, writes the economic newspaper.

Greece’s PM reiterated his determination to put an end to austerity, to stimulating the economy “based on social justice,” and to renegotiate the national debt under a new economic programme. The Greek government will “keep all its electoral promises,” as it’s a question of “honour and respect”, he adds, quoted in Les Echos. Greece doesn’t want to extend the financial aid programme, but would rather a relay programme instead, Mr Tsipras went on.

Naftemporiki reports that Mr Tsipras announced radical changes in taxation with the establishment of a single tax scale, the abolition of the unified property tax (ENFIA) from 2015 and the restoration of the taxable limit of €12,000. Furthermore, Mr Tsipras clarified that the commitments for the protection of the debtors from auctions will be implemented, while he said that the auctions of primary residences will be forbidden.

In another article Les Echos says that the Eurogroup is pressuring Greek Finance Minister Yanis Varoufakis to request an extension, from February 28 until June 30, of the current financial aid programme, in order to avoid any legal void and market risk. Eurogroup President Jeroen Dijsselbloem already warned Athens that there is no question of granting bridge loans for the coming four months.

La Repubblica notes that Mr Tsipras also said that his government will call for a “bridge programme” until June to present realistic proposals. Finland’s Helsingin Sanomat adds that this programme will be presented to the EU within a week. The nearly bankrupt country’s ability to pay is at stake if its government bonds lose eligibility at the ECB in March, adds the daily. De Volkskrant also mentions yesterday’s statements of the Greek PM, announcing that he will refuse the last emergency loan of €7.2 billion, as well as the reforms that go hand in hand with it.

Belgium’s De Standaard quotes Mr Tsipras, explaining that “it is an irrevocable decision by the government to completely implement our campaign promises.” In an interview granted to The Guardian, EC VP for Euro and Social Dialogue Valdis Dombrovskis underlined that “the democratic choice of the Greek people” is respected. “The European commission is willing to engage with Greece. The basis of the negotiations is that all sides stick with their commitments”, he further stressed.

María Antonia Sánchez-Vallejo writes in El Païs that Mr Tsipras showed on Sunday a defiant tone underlining that he will give priority to providing food and lodging for the poor and rehiring dismissed civil servants over his European partners and creditors. MEP Guy Verhofstadt writes in his column in L’Opinion that since his election Tsipras has had the opportunity to realise how isolated he is politically and how fragile his country is financially. Instead of engaging in nationalist rhetoric, Mr Tsipras would be better off implementing the most credible part of his agenda in order to restore confidence from his partners, who are in no mood to open purse strings with no guarantee in return, underlines Mr Verhofstadt.

“Tsipras cannot intend the EU to pay for his electoral promises”, reads El Mundo’s editorial. Mr Tsipras and Mr Varoufakis are currently experiencing a positive mood in Greece but dissent in other EU member states, says Guido Bohsem in Süddeutsche Zeitung. “Rarely has home and foreign perception diverged so much as with Greece” in these days, he notes. Along the same lines, in the WSJE Simon Nixon discusses the impasse between the EU and Greece over its attempts to renegotiate the terms of its bailout. Mr Nixon warns that Mr Tsipras’s attempts to oversee an economic revival will be hamstrung if he focuses on cutting political deals with the euro area at the expense of improving the country’s access to markets.

In a commentary for Sole 24 Ore, Adriana Cerretelli also stresses that no one can afford long negotiations over Greek debt, as markets could trigger a dangerous contagion. Now that the Greeks are playing it hard, a Grexit is likely to follow, writes De Telegraaf. Kevin Hoffmann argues in a commentary for Der Taggespiegel that Russian President Vladimir Putin would gladly finance Greece’s exit from the euro area, but that Yanis Varoufakis stated that his country “will never ask Moscow for financial aid.”

The EP S&D group officially advocates that Greece must keep its euro area membership and that the troika should be replaced by the European Commission and European Council, Diário Económico reports. MEP Maria João Rodrigues said that Greece still needs reforms and that unreal increases in wages and pensions cannot be accepted. She stressed that the troika programme must not continue as it failed in its goals. Slovakian National Council MP Ivan Mikloš argues in Hospodarske Noviny that the euro area’s main problem is the divergence in the countries’ competitiveness stemming from the absence of structural reforms and fiscal responsibility. We need a strong economic and monetary union built on strong and enforceable rules, Mr Mikloš concludes, underlining that these rules include those regarding a voluntary and involuntary exit of a country from the bloc.

Meanwhile, The FT reports that Washington is “pushing” euro area governments to compromise with Greece, due to concern about the potential effects of protracted talks on the global economy. In another FT article Wolfgang Münchau argues that Athens has only four choices, namely, extend the existing programme, secure the release of Greek bond interest payments, find the money from another source or issue a parallel currency.

Austria’s Der Standard reports that during today’s meeting in Vienna, Greek PM Tsipras will propose a programme to Austrian Chancellor Werner Faymann on how to overcome the country’s financial and social plight. Mr Tsipras will try to renegotiate the terms of the EU bailout programme with EU finance ministers on Wednesday and at the European Council meeting on Thursday, report several media, including the Austrian newspaper.

Greece’s Ethnos and Mega TV say that the EC believes that there is room for manoeuvre, provided that the Greek government will commit to the adjustment of fiscal policies and reforms. Annika Breidthardt, the spokesperson of Commissioner Pierre Moscovici underlined, in that sense, that Brussels is determined to work in a constructive manner with the Greek authorities and all the institutions involved, with the aim to achieve a mutually beneficial agreement for Greece and Europe as a whole, says Greece’s Alpha TV.

In Der Spiegel, Martin Hesse and Christian Reiermann analyse Greece’s latest attempts to find debt relief. The authors assert that neither the Greek government nor its European partners will benefit from a confrontation. © European Union, 2015

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