[Marxism] Greece: redlines, grexit? (6)
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Thu Apr 30 20:37:43 MDT 2015
Greece defiant as creditors pile on the pressure
by Paul Tugwell
Irish Examiner, APRIL 20
. . .
Greece’s red lines are refusing to cut wages and pensions, introduce
new taxes or sell state assets, alternate health and social security
minister Dimitris Stratoulis said in an interview on Saturday with
Athens-based Skai TV. “The Syriza-led government will carry out the
reforms the Greek people need, not ones requested by our creditors,”
he said. The country won’t be pressured “by euro-exit threats,” he
Greece won’t agree to any privatisation, Panagiotis Lafazanis, the
energy minister said yesterday. While “so-called” partners, including
unidentified IMF officials, want to “blackmail” the Greek government
into adopting measures that would hurt the working class, “we won’t
betray the people’s mandate,” he said.
. . .
1) Greece, Euro-Area Partners Target Deal by Sunday
BloombergBusiness, April 29, 2015
by Karl Stagno Navarra, Eleni Chrepa, Nikos Chrysoloras
Greece and its euro-area partners are stepping up talks in a bid to
break an impasse over bailout aid amid conflicting signals from the
country’s government over its willingness to agree on long-stalled
With Greece facing a cash crunch in early May, both sides in a meeting
of euro-area officials agreed to pursue intensive negotiations
beginning on Thursday with the target of a preliminary deal by May 3,
according to three people with knowledge of the talks. The aim would
be for finance ministers to sign off on the accord by their next
scheduled meeting on May 11, the officials said, asking not to be
named because the talks are private.
. . .
A key factor in a potential breakthrough may be the decision by Prime
Minister Alexis Tsipras to intervene and play a major role in the
negotiations to help the process along. That gave the signal that his
government may at last be willing to do what’s needed to unlock the
. . .
. . .
An agreement could still stumble at opposition within Tsipras’s
government as his cabinet prepared to take stock of the bailout talks
at a meeting later Thursday. In a sign of the obstacles yet to
overcome for a deal, Greece’s finance ministry said in a statement
Wednesday that the government “retains red lines” in the negotiations,
which include a sales tax on islands, pension and labor market reforms
and asset sales.
Greek Finance Minister Yanis Varoufakis on Thursday said Greece
wouldn’t discuss pension cuts or the sales tax increase in the current
talks, with any pension reform being part of a broader agreement in
June. He expressed hope that Greece would be able to regain market
access after June.
“We hope that negotiations will result in a normalization of the
situation, so that we can enter a recovery period after June, regain
market access, sell bonds, in the framework of sustainable debt,”
Varoufakis told lawmakers in Athens.
. . .
The new negotiating team, which includes Deputy Foreign Minister
Euclid Tsakalotos, is preparing a bill that may include changes to the
country’s taxation system and public administration. The bill won’t be
submitted to parliament unless it’s part of a deal with creditors, a
senior Greek official said.
Tsipras said earlier this week that he may need a referendum to garner
public support for a deal that would go against the government’s
campaign pledges. Yet, a poll conducted after his remarks and
broadcast on Mega TV on Wednesday showed that sixty-two percent of
Greeks oppose a referendum and 78 percent want the government to reach
a deal with its creditors.
. . .
2) Greece signals concessions in crunch talks with lenders
by Lefteris Papadimas and Deepa Babington
Reuters, April 30
(ATHENS) - Greece's government signaled 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.
. . .
Elected on promises to end austerity and scrap an unpopular EU/IMF
bailout program, Tsipras had so far refused to give ground on his "red
lines" - pensions, labor reform and state asset sales.
After a preparatory meeting of senior Greek officials on Wednesday, a
top government official said Athens was willing to sell a majority
stake in its two biggest ports and compromise on value-added tax rates
and some pension reforms, in the clearest signal yet that it is ready
to back down for a deal.
"The Greek government is ready for an honest solution which will
unlock financial aid from partners and put an end to the economic
asphyxiation the bailouts have caused," Finance Minister Yanis
Varoufakis, who was sidelined from the bailout talks this week to
appease lenders, told Sto Kokkino radio.
However Tsipras's office on Thursday denied any climbdown, seeking to
assuage hardliners in his Syriza party as he tries to satisfy Greece's
creditors before its coffers are empty.
"The government is sticking to its red lines," an aide to the premier
said on condition of anonymity. "The government does not have the
popular mandate to reach a deal that crosses red lines and it won't do
The top Greek official said Athens could consider a flat VAT rate on
all goods and services except drugs, foods and books and could adjust
supplementary pension payouts, though it insists on not cutting those
below 300 euros a month.
The so-called "13th month" payment to pensioners has been a target of
some euro zone finance ministers whose countries have less generous
systems but have been lending to Greece as part of the 240 billion
euro EU/IMF bailout.
On increasing the minimum wage - a campaign promise by Tsipras that is
strongly opposed by lenders - the official said Athens would consult
with the OECD and the International Labour Organisation before taking
any action, the official said.
. . .
3) Greece to present draft reform bill to lenders
Kathimerini, Athens, April 29
. . .
The talks have been held up on disagreement about major issues like
pension and labor reform as well as a proposed value-added tax hike on
Greek tourist islands.
One official said the government would try to move forward on the
labor deadlock by pushing back its plan to raise the minimum wage, a
move the lenders oppose.
However, Greece's deputy labor minister reiterated the government
would not agree to demands for further pension cuts.
"Our government is making every possible effort right now to have a
positive deal, which will respect our program, which will respect the
main principle of our program since we took power, which is to put a
brake on wage and pension cuts," deputy Labor Minister Dimitris
Stratoulis told Mega TV.
The draft bill is expected to be debated at a cabinet meeting in
Athens on Thursday, a finance ministry official said on condition of
anonymity. Once approved, it would then go on to be debated in
. . .
4) Greek bailout talks to stretch into weekend
by Derek Gatopoulos and Lorne Cook
AP April 30, St. Louis Post-Dispatch
Greece has entered a new round of bailout talks with creditors that
are expected to stretch into the weekend, but insists it is not ready
to make key concessions despite facing a major debt repayment soon.
"My answer is simple: No, no, no," Finance Minister Yanis Varoufakis
told private Sto Kokkino radio on Thursday, referring to key reforms
demanded by bailout lenders.
The creditors have for three months been trying to get Greece to agree
to a list of budget measures before they accept to pay it the
remaining 7.2 billion euros ($8 billion) installment of its bailout
. . .
Rescue creditors argue the country has fallen behind on long-terms
reforms that would allow it to get back on its feet: lowering state
funding for pensions, increasing turnover of staff in state jobs,
further dismantling job protection rules, and simplifying sales-tax
. . .
Varoufakis indicated his government could make concessions — but only
in the summer, after an initial deal is reached to unlock the 7.2
"After June, we are willing to look at many issues," Varoufakis told
Sto Kokkino radio in Athens. He signaled, for example, he'd be willing
to raise some sales tax rates.
. . .
5) Majority of Financial Pros Now Say Greece Is Headed for Euro Exit
by Ian Wishart
BloombergBusiness, April 29
Greece, mired in a protracted financial crisis and at loggerheads with
its bailout stewards, will leave the euro, according to the majority
of investors, analysts, and traders in a Bloomberg survey.
Fifty-two percent of the respondents in the Bloomberg Markets Global
Poll believe the cash-strapped country will leave the 19-nation bloc
at some point, compared with 43 percent who see Greece remaining in
the euro for the foreseeable future. In answer to the same question in
mid-January, just 31 percent of poll respondents predicted a Greek
exit and 61 percent had the country staying in.
The downbeat assessment of Greece’s prospects, more than five years
after the country’s first bailout, comes as the country stands on the
edge of a financial abyss. Prime Minister Alexis Tsipras has so far
failed to squeeze a loan payment out of his country's institutional
creditors as he sticks to his pledge to dial back austerity, while the
nation’s banks stay on European Central Bank life support.
“The banking sector is Greece’s Achilles heel, and if the ECB decides
to stop funding, then the situation will be even more fragile than it
is at the moment,” said Diego Iscaro, a senior economist at research
company IHS Global Insight in London. “That could trigger an
Having lost access to capital markets and being ineligible for the
ECB’s regular financing operations, Greece’s banks are reliant on the
ECB-approved Bank of Greece Emergency Liquidity Assistance.
. . .
6) IMF Doesn’t Expect Greece to Exit Eurozone
But spokesman signals IMF could be preparing contingency plans in case
by Ian Talley
Wall St. Journal, April 30, 2015
The International Monetary Fund doesn’t expect Greece to exit the
eurozone, a spokesman said Thursday, but he signaled the IMF could be
preparing contingency plans if Athens defaults.
“Our baseline position is that we don’t expect an exit,” IMF spokesman
Gerry Rice told reporters in a regular briefing when asked if the fund
was preparing for a so-called Grexit. “As with all other countries, we
are always looking at different scenarios...that is par for the course
with the IMF,” he said.
As the standoff between Greece and its creditors over emergency
financing continues, some eurozone finance ministers have acknowledged
they are considering plans on what to do if the country defaults on
its debt obligations coming due in the coming weeks.
Mr. Rice also said that Athens hadn’t given the IMF sufficient access
to its accounts for the fund to determine if the government has
sufficient cash to meet all of its coming obligations.
The spokesman said that Greece owes the IMF a €200 million interest
payment on May 6 and a principal payment of €750 million is due on May
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