Greece Archives

Greece debt crisis: Reforms ‘going to fail’ – Varoufakis

July 18, 2015 By administrator

The former Greek finance minster has said his country’s economic reforms are “going to fail”, just as formal talks on a huge bailout are set to begin, the BBC reports.

In a BBC interview, Yanis Varoufakis said Greece was subject to a programme that will “go down in history as the greatest disaster of macroeconomic management ever”.

The German parliament approved the opening of negotiations on Friday.

The bailout could total €86bn (£60bn) in exchange for austerity measures.

In a damning assessment, Mr Varoufakis said: “This programme is going to fail whoever undertakes its implementation.”

Asked how long that would take, he replied: “It has failed already.”

Mr Varoufakis resigned earlier this month, in what was widely seen as a conciliatory gesture towards the eurozone finance ministers he had frequently clashed with.

He said Greek Prime Minister Alexis Tsipras, who has admitted that he does not believe in the bailout, had little option but to sign.

“We were given a choice between being executed and capitulating. And he decided that capitulation was the ultimate strategy.”

Mr Tsipras has announced a cabinet reshuffle, sacking several ministers who voted against the reforms in parliament this week.

Energy minister Panagiotis Lafazanis, one of the hardline rebels, was among those replaced.

But Mr Tsipras opted not to bring in technocrats or opposition politicians as replacements.

As a result, says the BBC’s Mark Lobel in Athens, Mr Tsipras will preside over ministers who, like himself, harbour serious doubts about the reform programme.

Greece must pass further reforms on Wednesday next week to secure the bailout.

Germany was the last of the eurozone countries needing parliamentary approval to begin the talks, with Greece voting to accept hard-hitting austerity measures earlier in the week.

But the head of the Eurogroup of finance ministers, Jeroen Dijsselbloem has warned that the process will not be easy, saying he expected the negotiations to take four weeks.

Some Greek banks could reopen on Monday following weeks of closures, after the European Central Bank (ECB) raised the level of emergency funding available.

Separately, the European Council approved the €7bn bridging loan for Greece from an EU-wide emergency fund. The loan was approved in principle by eurozone ministers on Thursday and now has the go-ahead from all non-euro states.

It means Greece will now be able to repay debts to two of its creditors, the ECB and International Monetary Fund (IMF), due on Monday.

Greece struggles with wildfires, France sends firefighting planes

July 17, 2015 By administrator

By John Hadoulis AFP,

Athens (AFP) – Greece appealed for EU assistance Friday to battle wildfires raging on the outskirts of Athens and in the southern Peloponnese region that forced the evacuation of several villages.

Prime Minister Alexis Tsipras said he had requested help to fight the fires and announced army and airforce units were being deployed to douse the flames.

“All firefighting forces, in addition to the army and the airforce, are on alert,” Tsipras told reporters, blaming the outbreak on “emergency weather conditions”.

“We all need to stay calm,” he said.

Greece had asked for four aircraft from Europe, fire department spokesman Nikos Tsogas told a briefing.

France’s interior ministry said it was sending two water-bombing Canadair planes and a reconnaissance aircraft following the appeal.

It said this was an “important effort” as the wildfire season had already hit France.

EU Commissioner for Humanitarian Aid and Crisis Management, Christos Stylianides, said the EU “stands by Greece to help in the response to this natural disaster”, and added his gratitude to France.

Tsogas said fire fighting forces were continuing to work through the night to put out fires still blazing in Kareas, Malakasa, Neapoli in Lakonia and Spathovouni in Corinth.

Around 300 firemen with over 100 fire engines, a dozen airplanes and six helicopters had battled during the day to hold back the flames on Athens’ doorstep and the Peloponnese.

The fire in Athens broke out on brush land on Mount Hymettus around midday, near the northeastern district of Kareas, and later spread to the outskirts of residential areas.

Within a few hours, it had crossed the mountain and was threatening the districts of Ilioupoli and Glyfada close to the Athens coast.

– ‘Clearly arson’ –

In the afternoon, a new fire front broke out in Malakassa, north of the capital.

Television images showed residents dousing pockets of flames with buckets and garden hoses as local officials said the blaze was started deliberately.

“This is clearly arson, I heard explosive devices go off in the forest,” Vassilis Balassopoulos, the mayor of the district of Ilioupoli that borders the mountain, told Vima radio.

A huge grey cloud billowed over the city, and a nunnery and a children’s shelter were evacuated.

Earlier in the day, four villages were evacuated in the Peloponnese peninsula, near the town of Monemvassia, where strong winds fanned a raging wildfire, local officials told state agency ANA.

“It’s hellish right now, there are hundreds of pockets of fire,” Iraklis Trichilis, mayor of the town of Monemvassia, had earlier told Skai television.

The fire department said five homes in the area had been burned down.

“The town is being evacuated, we can only see two metres ahead of us,” said a resident of the coastal town of Neapoli, where a health centre and retirement home were also emptied by authorities.

National civil protection chief Tassos Mavropoulos told Skai TV that reinforcements from the entire Peloponnese region had been rushed to the area, where the operation was hampered by the wind and mountainous terrain.

A fire-fighting plane was forced to make an emergency landing near Neapoli but the two pilots escaped with only minor injuries.

Fire department spokesman Tsogas had earlier warned there could be further damage to property.

“The winds are strong and are not expected to weaken. There could be further damage,” he said.

A fire also broke out on the island of Evia and was threatening homes, officials told state agency ANA.

Greece is routinely hit by wildfires at this time of year, many started by arsonists, every summer, fanned by high temperatures and strong winds.

The worst recent major blazes, in the Peloponnese and on the island of Evia in 2007, left 77 people dead and ravaged 250,000 hectares.

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Greek parliament approves tough creditor reforms bill: AFP count

July 15, 2015 By administrator

Greece’s parliament early on Thursday approved a bill of tough reforms demanded by the country’s creditors in return for a new bailout, an AFP count showed.

The ruling radical Syriza party passed the bill thanks to support from pro-European opposition parties as several government lawmakers, including former finance minister Yanis Varoufakis, voted against the measures.

Turkish jets violate Greek air space

July 15, 2015 By administrator

A formation of six Turkish fighter jets violated Greek national air space in the northeastern, central and southeastern Aegean on Wednesday, defense officials said. Report ekathimerini

The Turkish jets, which were flanked on one side by another aircraft that was not a part of the formation, carried out a total of 20 transgressions, the defense officials said, adding that two of the aircraft were armed and that one dogfight occurred.

In all cases, the Turkish jets were chased off by Greek aircraft.

Greek deputy finance minister resigns over debt deal

July 15, 2015 By administrator

Greek Deputy Finance Minister Nadia Valavani (Photo from wikipedia.org)

Greek Deputy Finance Minister Nadia Valavani has resigned ahead of the key vote in the Greek parliament on a third bailout agreed between Prime Minister Alexis Tsipras and the country’s creditors. She described the deal as Greek agony. Report RT

“Alexis, I am ready to serve in any capacity to the end during challenges. However, when our delegation returned with liabilities that are ‘stillborn measures’ and at such a price [by the creditors in fulfilling the reforms program], once again when the dilemma appears of retreating or Grexit, it will be impossible for me to remain a member of the government,” Valavani’s letter reads.

She called the debt deal reached Monday a “capitulation” by the government, that’ll hit the Greek people.

“This ‘capitulation’ is so overwhelming that it will not allow a regrouping of forces. With your signature there will be a deterioration in the status of an already suffering population, and this will be a tombstone around their necks for many years with little potential of redemption,” she wrote.

The letter was made public by the Greek finance ministry on Wednesday. Valavani was one of two deputy finance ministers, and was in charge of taxation and overseeing privatization.

The Greek parliament is going to vote on Wednesday on the austeritydealmade between the creditors and Tsipras. There is no unanimity within Tsipras’ Syriza party. The vote can break up Syriza’s anti-austerity coalition with right-wing ANEL. This could lead to new elections in Greece.

Since the agreement Alexis Tsipras has been expected to reshuffle the government, with the resignation of Syriza members who refuse to support the agreement with European creditors.

Greeks Never Lose Their Humor; Funeral Home Named ‘Wolfgang Schaeuble’

July 14, 2015 By administrator

by Ioanna Zikakou,

Greeks are known for their humor and their ability to maintain it even in the most difficult situations. When that humor combines with business ideas, then the result is even more spectacular.

For example, the owner of a funeral home in Agrinio, central Greece, found a way to make fun of Greece’s current financial situation and the blackmail that the country has received from its European partners, and especially Germany.

The funeral home owner took advantage of the political developments and rename his business after the relentless German Finance Minister Wolfgang Schaeuble. Over the last few days, the funeral home photographs have gone viral among social media users, mainly on Facebook and Twitter.

German Finance Minister Wolfgang Schaeuble has been a strong supporter of the Grexit idea. Over the past few days he has proposed various measures and plans that would lead Greece outside the Eurozone, for example he proposed that the country takes a five-year time out from the monetary union.

Furthermore, he has also suggested tο Greece that 50 billion euros of Greek public assets be transferred to an external fund and privatized over time. The fund he used as a suggestion, the Institution for Growth in Greece, is owned by the German bank KfW, whose current Chairman of the Board of Supervisory Directors is Schaeuble himself.

His stance towards Greece has not only been criticizeδ by other European countries, but also from the people in Europe and across the world through social media.

– See more at: http://greece.greekreporter.com/2015/07/14/greeks-never-lose-their-humor-funeral-home-named-schaeuble/#sthash.y3B87JSU.dpuf

German Company is Top Tax Evader in Greece

July 14, 2015 By administrator

by Sotiria Nikoloul,

A German company was found to be the biggest tax evader in Greece. A court in Athens found that Hochtief, the German company that was running the “Eleftherios Venizelos” Athens International airport was not paying VAT for 20 years. It is estimated that Hochtief, will have to pay more than 500 million Euros for VAT arrears. Together with other outstanding payments, like those to social security funds, it might have to py more than 1 billion Euros.

It must be noted that under the “Troika” austerity programme Greek employees lost around 400 million Euros from cuts to their salaries.

Hochtief, which is the biggest German Construction company, specializing in airports, was also running the Athens International airport through a subsidiary until 2013, when it sold it’s share to a Canadian company.
(source: neurope)

Greek bailout or Greek sale-out? Alexis Tsipras battles own MPs over Greek bailout deal

July 14, 2015 By administrator

Greek prime minister in talks with own MPs amid speculation he could be forced to form a national unity government and sideline leftwing Syriza faction.

A beleaguered Alexis Tsipras was locked in talks on Tuesday with his own MPs amid speculation that the Greek prime minister could be forced to form a national unity government to push through the draconian bailout deal imposed by Brussels on debt-stricken Greece. Report The Guardian

Facing a rebellion over the terms of a fresh €86bn (£61bn) rescue package, Tsipras has considered sidelining the increasingly belligerent leftwing faction in Syriza in favour of a broader coalition to push through spending cuts and painful reforms.

In Brussels, meanwhile, EU finance ministers met to discuss how a fresh bundle of loans can be pieced together to bridge Greece’s current funding gap.

Athens faces demands to repay €7bn of debts in July, including €3.5bn due to the European Central Bank on 20 July. This will require a bridging loan of €10bn-€12bn, as the full bailout will not be agreed in time. All of the other 27 EU nations are expected to be asked to contribute.

The UK chancellor, George Osborne, said Britain will not contribute any money to the Greek bailout, telling reporters:

Britain is not in the euro, so the idea that British taxpayers will be on the line for this Greek deal is a complete non-starter. The eurozone needs to foot its own bill.

Britain has contributed around £1bn to the European Financial Stability Mechanism (EFSM), but the funds have remained outside a scheme used to underwrite short-term loans to Greece following a deal between the UK and Brussels in 2010 stipulating that UK funds would only be used to protect the EU.

In Athens, one of the scenarios being considered is the formation of a cross-party government to not only push reforms through parliament but also play a role implementing them against what is likely to be stiff opposition.

The radical-left party is increasingly fighting a battle for survival in government with cadres saying Syriza’s overall aim is not to go down as a “left parenthesis” in power.

“Everything will be judged with the enforcement of real government policy which will not only be the agreement,” the interior minister, Nikos Voutsis, said on Tuesday morning.

Calling the proposed deal “very difficult, very bad”, the minister said the real issue the government faced would be finding and enacting policies that could have an ameliorating affect on the painful consequences that the measures were likely to have socially.

“Social counter-measures must be found which will give hope to people.”

Tsipras is seeking agreement among the 149 Syriza MPs who dominate the 300-strong parliament, but could splinter in response to a vote on the deal.

Greece has promised to pass into law by Wednesday a string of reforms as the price of a deal that include reforming the VAT system, overhauling pensions and signing up to plans that ensure immediate spending cuts in the event of breaching creditor-mandated budget targets.

Athens has agreed to sell off state assets worth €50bn, with the proceeds earmarked for a trust fund supervised by its creditors. Half the fund will be used to recapitalise Greek banks, while the remaining €25bn will pay down Greek debts as well as be investmented.

Determined to keep his party together ahead of an expected onslaught by MPs opposing the outlined deal, Tsipras summoned his closest allies to a meeting in Athens before a gathering of his parliamentary party on Tuesday.

Tsipras won backing from his coalition partner the Independent Greeks, after its leader Panos Kammenos initially criticised the deal and especially the £50bn of privatisations demanded by Brussels, which must be channelled into a separate fund.

Kammenos said: “We will stand by the Alexis Tsipras government.”

Many of Kammenos’s MPs have said the new agreement, as outlined in the marathon overnight meeting in Brussels, is much harsher than the original one the coalition had endorsed last weekend and, as such, is unacceptable.

But Kammenos is still backing the PM, telling reporters that:

“It is clear to all of Europe that [on Monday] a coup happened in the heart of Europe.

The PM was blackmailed into signing a very different agreement. And this coup is continuing here in Greece where people want the government to fall.”

The former Greek finance minister, Yanis Varoufakis, has called the deal “unviable” and likened it to the 1919 Treaty of Versailles – widely seen as the harbinger of the second world war for its crushing of Weimar Germany.

“This has nothing to do with economics. It has nothing to do with putting Greece back on the rails towards recovery,” Varoufakis told Australia’s public broadcaster, the ABC.

“This is a new Versailles treaty that is haunting Europe again, and the prime minister [Alexis Tsipras] knows it. He knows he’s damned if he does and he’s damned if he doesn’t.”

Emphasing the scale of the task ahead, the Bank of England governor, Mark Carney, told the Treasury committee in Westminster, that success will require “Herculean efforts” from all sides.

He said the scale of structural reforms, fiscal adjustment, privatisations required will be significant with “big execution risks”.

The central bank chief also put his weight behind arguments put forward by the International Monetary Fund that Greece needs its €340bn debt burden with public and private lenders to be cut if it is to emerge from under its debt mountain. He warned that Greece’s debts “are not sustainable in their current form”.

Eurozone Leaders Wanted to Overthrow Tsipras – Greek Defense Minister

July 13, 2015 By administrator

Sputniknews Report, During Sunday’s Eurozone summit, Greek Prime Minister faced attempts by a number of EU leaders to overthrow him, Greek Defense Minister Panos Kammenos said Monday, following a meeting with Alexis Tsipras.

ATHENS (Sputnik) — Kammenos said that Germany, the Netherlands and the Baltic countries tried to exert pressure on Tsipras.

“Tsipras was threatened with bank collapse and complete ‘haircuts’ of bank deposits in the predawn hours already,” Kammenos, who is also president of The Independent Greeks (ANEL) political party, said. Kammenos said that ANEL would not support the agreement with Greece’s creditors but would stay in the Syriza-led ruling coalition.Greece, which was among the countries hit worst by the 2008-2009 global financial crisis, is struggling to repay $270 billion owed to its main creditors — the European Central Bank, the International Monetary Fund and some Eurozone countries.

“We do not agree with the creditors’ proposals. We cannot agree with them,” Kammenos said. In a July 5 referendum, Greek voters rejected the lenders-proposed bailout plan. On July 9, the Greek government presented a bailout program of its own.

On Monday morning, following marathon talks, the leaders of the Eurozone reached an agreement on a new bailout package for Greece.

Earlier on Monday, a member of the European Parliament from the Spanish European United Left/Nordic Green Left (GUE/NGL) party, Marina Albiol said that German Chancellor Angela Merkel and some other heads of state and finance ministers of Eurozone countries tried to make Tsipras resign as revenge for holding the bailout referendum.

Greece and eurozone reach agreement in bailout talks

July 13, 2015 By administrator

Donald Tusk says new programme is ‘all ready to go’ but backlash intensifies with critics calling creditors’ terms harsher than Versailles treaty

The government in Athens and its creditors have reached a deal that will shore up Greece’s place in the eurozone after marathon overnight talks.

After 31 hours of acrimonious discussions spread over one tense weekend, a breakthrough came early on Monday morning. Donald Tusk, the head of the European Council, announced that the 19 leaders of the eurozone had unanimously reached agreement. Report The Guardian

He said they were “all ready to go” on a new programme for Greece under the eurozone bailout fund, the European Stability Mechanism, adding that Athens had signed up to “serious reforms”.

But the hard-fought political deal is only the start of yet another round of talks to hammer out the technical details of a bailout plan that could be worth up to €86bn (£61bn) for Greece.

In order to get these desperately needed funds, the radical left government of Alexis Tispras had to submit to draconian economic reforms that the Greek people had rejected in a referendum barely a week before.

Greece has promised to pass laws introducing controversial economic reforms by Wednesday. These include reforming the VAT system, overhauling pensions and signing up to plans that ensure immediate spending cuts in the event of breaching creditor-mandated budget targets.

Athens has also agreed to sell off state assets worth €50bn, with the proceeds earmarked for a trust fund supervised by its creditors. Half the fund will be used to recapitalise Greek banks, while the remaining €25bn will pay down Greek debts.

Tsipras did manage to win a concession that the fund should be managed from Greece, not Luxembourg, as envisaged in a German plan, but the rules will be drawn up by Greece’s creditors – the troika that Tsipras vowed to throw off, but only succeeded in renaming as “the institutions”.
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These institutions – the European commission, International Monetary Fund and European Central Bank – have also asked Athens to come up with a plan to “de-politicise” its civil service by next Monday.

In another humiliating climbdown, Athens could be forced to reverse measures it passed upon assuming power that are deemed to run counter to the bailout philosophy. Potentially, this could mean firing the government cleaners that Syriza rehired with such fanfare.

Paul Krugman, the Nobel-prize winning economist and prominent critic of austerity in Greece, said the creditors’ demands on Greece “went beyond harsh into pure vindictiveness, [leading to the] complete destruction of national sovereignty [with] no hope of relief”.

“It’s a grotesque betrayal of everything the European project was supposed to stand for,” he wrote several hours before the final deal emerged. As the talks dragged on through Monday night, #ThisIsaCoup became the top trending topic on Twitter in Greece, Germany, the UK and Ireland.

Echoing a widespread view on social media, one financial analyst claimed the deal was worse than the 1919 Treaty of Versailles that crushed Weimar Germany with debt and paved the way for the second world war.

Marc Ostwald, of ADM Investor Services, argued that the eurozone creditor countries wanted “to completely destroy Greece”.

Asked about the Versailles analogy, German Chancellor Angela Merkel said: “I never make historical comparisons.” She added that the Greek programme was “nothing special”, apart from the sums of money involved, and in line with other bailout schemes devised for Spain and Portugal.

Jean-Claude Juncker, the rejected criticism that Greece’s creditors had been too harsh. “I don’t think that the Greek people have been humiliated and I don’t think the other Europeans were losing their face. It’s a typical European arrangement.”

While recriminations continue to swirl, Greece urgently needs cash to stave off bankruptcy. Athens has to find €7bn by next Monday and a further €5bn by mid-July.

Eurozone finance ministers, who have been stuck on a loop of emergency meetings for three-and-a-half weeks, will reconvene at 15.00 in Brussels (14.00 BST) to discuss emergency bridge finance to tide over the Greek government while further talks on the €86bn bailout grind on.

Although EU leaders trumpeted the avoidance of Grexit, in the communique they made clear the deal could still unravel. “The risks of not concluding swiftly the negotiations remain fully with Greece.”

Greece’s parliament is expected to push through the controversial reform package by Wednesday, paving the way for parliaments in other eurozone members to ratify the agreement. The Bundestag and Finnish parliament are among several legislatures that must approve eurozone bailout programmes.

Finland is expected to reject any further bailout for Greece to avoid a schism that could topple its two-month-old government.