Athens, February 5, 2016/Independent Balkan News Agency
By Zacharias Petrou
The Greek government seems to have become trapped in an “impossible” situation as its negotiations with creditors appear to be at a dead-end and huge protests against social security reform continue.
On Thursday Greek government officials were reportedly shocked at the tough stance of the country’s creditors as all issues dominating its ongoing bailout program review remain open and the top officials representing the quadrigra of Greece’s lenders are not backing down from their demands.
Essentially, the social security reform plan put forth by the government has been rejected and must be reshaped to meet the demands of the creditors. Also, Greece must take more fiscal measures this year and next to ensure it will bridge gaps, as a European Commission report released Thursday highlighted.
Following Thursday’s huge protests in Athens, Thessaloniki and other cities and the general strike which brought the entire country to a standstill, the government is under incredible pressure.
Considering that Greek farmers also decided to continue their mobilizations and will not enter dialogue with the government unless its pension reform plan is withdrawn, the government now finds itself in a lose-lose situation.
Prime Minister Alexis Tsipras is reportedly being advised by close aides to call an early election if an agreement with creditors cannot be found. However, this scenario seems unlikely at the moment. Therefore, should Tsipras succumb to the pressure applied by the quadriga in order to stay in power he risks becoming largely unpopular amongst Greek voters.
In a meeting with German Chancellor Angela Merkel on Thursday in London, Tsipras complained to the German chancellor that Greece’s creditors are timewasting in negotiations and requested that the Greek bailout program review is not delayed any longer.
Tsipras also said that the troika has received the Greek social security reform proposal months ago but is still not prepared to submit their own ideas, even though the Greek proposal is along the lines of the bailout agreement.
The Greek PM added that nobody could doubt Greece’s determination to implement the MoU as its track record on reforms implemented so far is excellent.
According to media reports, Angela Merkel appeared to hear out Alexis Tsipras but was not keen on providing any specific reply to his complaints. Instead, she was eager to urge Tsipras to establish hot-spots for refugees and immigrants fast and to make sure Greece controls its borders properly, as it is obligated to do under the Schengen Agreement.
More pressure was heaped on the Greek government on Thursday as IMF managing director Christine Lagarde told reporters that if social security reform in Greece is not deep and substantial there could be no debt relief for the country.
According to the IMF chief, social security reform is crucial and vital to the recovery of the Greek economy.
The government’s economic team will meet anew with the heads of the institution’s mission in Athens on Friday to conclude the first phase of the negotiations.
Participants are expected to take stock of the first week. Subsequently, the representatives of the institutions are expected to leave Athens and return after about 10 days to continue the first program review, government sources said.