Lost years. How far ahead of time did the European institutions and the member states of the EU become fully aware of the Greek financial problem, before it all collapsed into the chaos we now see? This column was very much on its own when it suggested, as soon as the problems appeared insurmountable, that Greece leave the eurozone, leaving it to the legal experts to define the correct formula. Now, the debate is being carried on amidst endless problems and complications, involving hefty costs for the member states, at a time when the budgetary situations are extremely difficult in all corners.
Our bulletin regularly reports on the developments. I would like to add a few considerations as to the origin and reality of what is happening.
The real weight of the Greek debt. It's not easy to get a grasp of the situation from the figures, because the experts provide complex figures which, in some cases, can be pretty much a complete mystery to non-specialists. Let's just say that the most straightforward calculations put the Greek debt at €322 billion, basically divided up between the states of the euro area: €60 billion for Germany, €45 billion for France, up to €40 billion for Italy and so on for the other member states. The total amount of the credit would be around €200 billion for the countries of the single currency, plus the ECB's €26 billion.
This situation is not generally used as an argument by the creditor countries, although the Spanish Economy Minister, Luis de Guindos, observed that his country's loan to Greece (around €26 billion) was “the equivalent of what we spend in a year to help the unemployed” and that “any responsible politician would want to get that money back” (see EUROPE 11240).
Support on ice. The Greek Prime Minister, Alexis Tsipras, stressed that the EU is “built on disagreements, but most of all on compromise”. Even so, he turned down a further meeting in Athens with the traditional troika: European Commission-ECB-IMF. In the wake of this, the ECB (European Central Bank) announced in a press release that the regime in support of Greek banks had been suspended.
Theoretically, Athens is to pay back €2.3 billion to the IMF in February; €6.7 billion to the ECB in July; €15 billion to the Greek banks in general (see EUROPE 11244).
It is well known that one of the shortcomings for which Greece has come under fire is its inability to collect taxes efficiently. The technical details of the ECB's position are vital: the highly technical.
Right of veto. As like every other member state, the Greek government has a right of veto on all community discussions which require unanimity. This is as it should be. However, the uptake of this right is not uniform. For example, the Greek deputy minister for home affairs, Georgios Katrougkalos, has confirmed that his country will use its right of veto to block the draft agreement between the EU and the United States aiming to facilitate trade and investment. Leaving aside the legal details, it is worth reiterating that the TTIP has to be approved by the Community institutions and also by all of the member states. This treaty is controversial, it is being talked about; but as things stand, any debate has become pointless, as the Greek veto appears to have settled the matter. Strange behaviour in a Union.
Fraternity with Russia? Very recently, the Greek government and the Russian authorities recently had a friendly discussion, peppered with congratulations and compliments on both sides. That in itself draws no comment: positive relations with Moscow have always been considered by this column to be a necessary objective. However, the dialogue must be carried out by the EU as a whole (even if, on some occasions, it is represented by some or other individual) for discussions on an equal footing with Russia, in order to analyse the differences of opinion and negotiate compromises, whilst safeguarding European interests. However, the tone of how Greece is going about things is somewhat different…
Let us not forget that on 27 January of this year, Greece formally distanced itself from an EU declaration on new sanctions against Russia; it intended to oppose them. At the time, the Council of the EU suggested specifying that the text in question had been approved by 27 member states and not 28; Athens did not accept this wording. The cabinet of the Greek prime minister then stated that Mr Tsipras had expressed his country's discontent, in a telephone conversation with Federica Mogherini, the High Representative for Foreign Affairs (see EUROPE 11241 for the details).
This is nothing particularly dramatic, but it's an extra element of confusion which the current Greek attitude may raise. Times are hard and Europe needs to stand together.
(FR)