With Greece running out of money fast, it looks like Prime Minister and Radical Left leader Alexis Tsipras will have to give in to international lenders while trying to explain to supporters why he hasn’t, world press reports say.
Five Reasons Greece Won’t Leave Eurozone
Deutsche Welle – Max Hofman
1. A ‘Grexident’ isn’t as inevitable as you might think
Over the past months, we’ve heard over and over again that once the Greeks miss an IMF payment, they’re officially broke, the banks will close and an inevitable automatism will run its course. That’s not how it works. IMF chief Lagarde won’t instantly announce Greek bankruptcy. It would have to be formally established, which would take a few days.
2. An exit won’t make the deal cheaper
The Greeks exit the currency union – and then what? Remember the frequently invoked risk of infection. Speculators could try to drive Portugal or Italy into bankruptcy. These days the EU is better prepared for such scenarios than it was just a few years ago, but no one in Brussels would rule it out completely.
3. Geopolitical nonsense
Situated in the unstable Balkans, traditionally a friend of Russia, wide-open for refugees crossing the Mediterranean – Greece is all of the above. Do the EU member states want to drive such a country into complete isolation, with incalculable geopolitical consequences?
4. Tsipras finally got it
Some observers in Brussels say the ill-tempered finance ministers’ meeting in Riga was the turning point. Greek Prime Minister Tsipras understood that he doesn’t have any trump cards left, and accordingly swapped out his chief negotiators. It would seem that the troika is once again dealing with people who understand their job and aren’t simply idealistic daydreamers.
5. A union is a union is a union
If Greece were actually to exit in the end, the currency union would no longer be a real union. It would be more like an exchange rate network, at least that’s what it would look like.
Optimism Growing for a Deal with Greece
Irish Times – Suzanne Lynch
Negotiations between Greece and its lenders recommenced in Brussels yesterday under a new Greek negotiation team, with signs an interim deal could be struck as early as next week, amid concerns about Greece’s ability to pay €1 billion in debt repayments to the International Monetary Fund falling due within the next 12 days.
Economics professor Euclid Tsakalotos is leading negotiations, following the dismissal of finance minister Yanis Varoufakis from Greece’s negotiating team earlier this week, with signs Greece could be prepared to make concessions on one of the main policy areas under discussion – pensions, labour market reforms and privatisations.
There were signals from officials Greece could be prepared to implement changes to the pension regime and introduce a new flat rate of VAT, though the finance ministry in Athens insisted it still had “red lines”. In return, the EU may compromise on Greece’s primary surplus.
The Greek government is looking to unlock €7.2 billion of bailout funds due to the country under the terms of its outstanding bailout, though it must present reform measures in exchange. An end-of -April deadline, enshrined in the February eurogroup agreement agreed by Greece and its lenders, has effectively been missed, with focus now turning to May 11th.
Greece Signals Willing To Make Concessions
Reuters – Lefteris Papadimas and Deepa Babington
Greece’s government signalled the biggest concessions so far as talks with lenders on a cash-for-reforms package started in earnest on Thursday, but tried to assure leftist supporters it had not abandoned its anti-austerity principles.
Prime Minister Alexis Tsipras’s three-month-old government is under heavy pressure at home and abroad to reach an agreement with European and IMF lenders to avert a national bankruptcy. A new poll showed over three-quarters of Greeks feel Athens must strike a deal at any cost to stay in the euro.
An enlarged team of Greek negotiators began talks with the so-called Brussels Group representing the euro zone, the International Monetary Fund and the European Central Bank to discuss which reforms Greece will turn into legislation rapidly in exchange for aid.
The talks are expected to continue through the May Day holiday weekend until Sunday, with Tsipras willing to step in to speed things up if necessary, a Greek official said. In a sign of seriousness, both sides agreed on a news blackout at the meeting, a euro zone official said.
Greece wants an interim deal by next week, hoping this will allow the ECB to ease liquidity restrictions before a 750 million euro payment to the IMF falls due on May 12. Athens has suggested it will struggle to pay the instalment.
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