Greece gets its deal

Avoids fi­nan­cial col­lapse and euro exit

Cape Breton Post - - WORLD -

Af­ter gru­el­ing, of­ten an­gry ne­go­ti­a­tions that tested the lim­its of Euro­pean unity, Greece on Mon­day won a pre­lim­i­nary deal that averts fi­nan­cial catas­tro­phe but also guar­an­tees years more of hard­ship and sac­ri­fice for its peo­ple.

Prime Min­is­ter Alexis Tsipras flew home to sell the plan to skep­ti­cal law­mak­ers and po­lit­i­cal al­lies, some of whom ac­cused him of putting Greece at the mercy of its for­eign cred­i­tors.

To close the deal with its part­ners in the euro cur­rency, Greece had to con­sent to a raft of aus­ter­ity mea­sures, in­clud­ing sales tax hikes and re­forms to pen­sions and the labour mar­ket.

Enough of Greece’s 18 eu­ro­zone part­ners were openly sus­pi­cious of its sin­cer­ity that they de­manded, and got, Tsipras’s com­mit­ment to ac­cept close in­ter­na­tional over­sight.

For the Greek leader and his rad­i­cal left-wing gov­ern­ment, which since elec­tion in Jan­uary had vowed to stand up to the cred­i­tors, the pay­off of the marathon ne­go­ti­a­tions in Brus­sels was clear: about 85 bil­lion eu­ros ($95.07 bil­lion) in loans and fi­nan­cial sup­port over three years, pre­serv­ing Greek mem­ber­ship in the euro, and help­ing their coun­try stave off fi­nan­cial col­lapse.

“We man­aged to avoid the most ex­treme mea­sures,” Tsipras said af­ter the sum­mit.

Tsipras said he suc­cess­fully got cred­i­tors to drop a de­mand that Greek as­sets be trans­ferred abroad as a form of col­lat­eral, and that the deal reached was less harsh than pro­pos­als from cred­i­tors his coun­try’s vot­ers re­jected a week ago.

But in many cases, or­di­nary Greeks now face tougher mea­sures than those they voted down in a na­tion­wide ref­er­en­dum. Syriza’s Left Plat­form, a group of tra­di­tion­al­ists in Tsipras’s own party, swiftly de­nounced the agree­ment he had reached with fel­low eu­ro­zone lead­ers as the “worst deal pos­si­ble ... that main­tains the coun­try’s sta­tus: a debt colony un­der a Ger­man-run Euro­pean Union.”

Af­ter fly­ing home to Athens, Tsipras went to the prime min­is­ter’s of­fice to meet with Fi- nance Min­is­ter Eu­clid Tsakalo­tos and other top party of­fi­cials. To abide by the agree­ment and en­sure that ne­go­ti­a­tions on a new in­fu­sion of fi­nan­cial aid for Greece can start in earnest, Tsipras must push sev­eral un­palat­able mea­sures through Par­lia­ment by Wed­nes­day.

Pas­sage ap­pears as­sured, though he faces an up­hill bat­tle to per­suade mem­bers of his own party, as well as his gov­ern­ing coali­tion part­ner, a small right-wing party, to back the deal.

Greece needs another bailout, its third in five years, to dig it­self from un­der a moun­tain of debt and get its econ­omy back on its feet af­ter a six-year de­pres­sion. Fol­low­ing months of talks with its euro- zone part­ners and other in­ter­na­tional cred­i­tors, its econ­omy is tee­ter­ing on the brink of col­lapse — banks have been shut for two weeks and daily busi­ness has al­most ground to a halt.

Greece will now be on a tight timetable to im­ple­ment the new re­forms — another re­flec­tion of how lit­tle its cred­i­tors trust the gov­ern­ment to hon­our a deal. Both sides in Brus­sels ac­knowl­edged the bit­ter­ness that marked their ne­go­ti­a­tions, which lasted nine hours past a Sun­day mid­night dead­line.

“Trust needs to be re­built,” said Ger­man Chan­cel­lor An­gela Merkel, adding that with the Mon­day deal, “Greece has a chance to re­turn to the path of growth.”

AP PHOTO

A bank em­ployee dis­trib­utes tag queue po­si­tions to el­derly peo­ple to en­ter into the bank to with­draw a max­i­mum of 120 eu­ros ($134) for the week in cen­tral Athens, Mon­day.

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