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With state coffers running dry, Greek officials are conducting a whirlwind series of meetings across Europe hoping to get political backing for debt relief, and asking the European Central Bank to raise the ceiling on Treasury bills that can be sold – essentially to Greek banks.

The coalition government led by Prime Minister and Radical Left SYRIZA leader Alexis Tsipras is refusing to impose more austerity reforms demanded by the troika of the European Union-International Monetary Fund-European Central Bank (EU-IMF-ECB) which is holding back a 7.2- billion euro installment until he does.

Tsipras won the Jan. 25 snap elections on the back of his promise not to negotiate with the troika – he is – and to reverse the big pay cuts, tax hikes, slashed pensions and worker firings implemented by two previous governments dominated by the New Democracy Conservatives and the almost-defunct PASOK Socialists.

Key to Greece’s immediate survival, government officials said, is convincing the ECB to let it sell Treasury bills. The last time an issue was let, only Greek banks – already teetering by a run on deposits – bought them because investors have been scared off by the prospect of a default and the country being forced out of the Eurozone and unable to repay anybody.


The IMF is squeezing hard. The Financial Times said that the agency, which is to put up half of the 7.2- billion euro installment, warned that Greece will post only a 1.5 percent primary surplus instead of the 3 percent goal that has been set. That is available money not including debt on interest, the cost of running cities and towns and state enterprises, social security and some military expenditures, which create a huge deficit when counted.

Shortly after reports that the IMF has upped the pressure in debt talks, Tsipras “discussed matters relating to the current negotiations” with the Fund’s chief Christine Lagarde, his office said, without explaining what that meant, what was said and if anything came out of it as it never has before.

Deputy Prime Minister Yiannis Dragasakis is to meet with ECB President Mario Draghi in Frankfurt on May 5 along with Euclid Tsakalotos, the Deputy Foreign Minister who has been tasked with “coordinating” Greece’s negotiating team at the same time Finance Minister Yanis Varoufakis insists he’s in charge.

As Dragasakis and Tsakalotos meet with Draghi in Frankfurt, Varoufakis is due in Paris for talks with his French counterpart Michel Sapin. He is then to fly to Brussels for talks with European Economic and Monetary Affairs Commissioner Pierre Moscovici.

Varoufakis had been sidelined from being the point man in negotiations because his combative style had irritated his Eurozone counterparts who reportedly called him an “amateur,” and a “gambler,” which he denied they did.  But now he said he’s back on top and running the show for Greece.

The flurry of meetings comes as Greece must repay the IMF 200 million euros on May 6, and 700 million euros on May 12, as well as 2.5 billion euros in salaries and pensions this month.

From where the money will come is a mystery because tax revenues are plummeting, the country is locked out of the markets by prohibitively high interest rates, the troika is holding back loans and the only way salaries and pensions were paid in April was by a one-time raid on all the spare cash in cities and towns, state enterprises and pension funds.

Because Varoufakis has since a four-month bailout extension was given on Feb. 20 failed to produce a credible list of reforms beyond vague outlines, no deal is expected at the May Eurozone meeting although the lenders keep setting and moving back deadlines amid relentless talks of doomsday for Greece, which hasn’t happened yet.

While the troika said talks are essentially at a standstill, government spokesman Gavrill Sakellaridis told reporters they were going well but admitted that “liquidity is a pressing issue,” bureaucratic code to mean Greece is broke.

The post Running On Empty, Pressure Grows On Greece To Make Deal appeared first on The National Herald.

Source: The National Herald
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