Re­la­tion­ship trou­bles

Kathimerini English - - Front Page - BY ALEXIS PAPACHELAS

Greece is in the mid­dle of very tough ne­go­ti­a­tions with the troika. The truth is that at some point the gov­ern­ment’s re­la­tion­ship with its cred­i­tors some­how went off course. It’s as if the trust which had been built over the past two years is just not there any­more. The same Euro­pean of­fi­cials who had hailed Greece’s pri­mary sur­plus re­fused to do the same when the re­ces­sion-rav­aged econ­omy ex­panded for the first time in six years. The dif­fer­ence in tone is hard to ex­plain. Per­haps the gov­ern­ment did not weigh its strength care­fully. Per­haps it over­es­ti­mated the coun­try’s abil­ity to bor­row from the mar­kets with­out a safety net – and with clear po­lit­i­cal risk in sight. Or maybe its uni­lat­eral moves in rev­enue pol­icy or its se­lec­tive read­ing of the var­i­ous pro­vi­sions caused more re­ac­tions than it had an­tic­i­pated. Ac­cord­ing to a dif­fer­ent in­ter­pre­ta­tion, Euro­pean of­fi­cials are seek­ing any ex­cuse to avoid mak­ing any an­nounce­ments on the Greek debt, for that would in­cur con­sid­er­able po­lit­i­cal cost. There’s also an ut­terly cyn­i­cal point of view which says that no bank would ever lend hard cash to a company if it felt the lat­ter’s en­tire man­age­ment might change at the next board meet­ing and that the new ad­min­is­tra­tion would have no idea what to do when it as­sumes power. In other words, Greece’s lenders might not wish to con­clude the ne­go­ti­a­tions un­til they find out whether a new pres­i­dent will be elected by the cur­rent Par­lia­ment or whether an elec­tion will be held and, if so, who will win. Where all this will lead to will be­come ev­i­dent in the next few days. What is cer­tain is that we’re play­ing with fire. Let’s hope that the gov­ern­ment will keep its cool and the coun­try will avoid slid­ing into a pe­riod of in­sta­bil­ity that could last for months and which would fur­ther stall the cau­tious growth ev­ery­one is hop­ing for. In the last few months the gov­ern­ment has been op­er­at­ing in a de­fen­sive and of­ten knee­jerk man­ner. No­body talks to the peo­ple, no­body is ex­plain­ing how much of what needs to be done is “mon­strous” and how much is “sen­si­ble” stuff that any Greek gov­ern­ment ought to carry out on its own ini­tia­tive. Up un­til last June there was clearly a plan which of­fi­cials fiercely sup­ported in pub­lic. Then came fa­tigue, fear and a sense of in­tro­ver­sion. It’s a dif­fi­cult point in time which de­mands cool heads and de­ter­mi­na­tion. No one’s ask­ing the troika to make Greece’s do­mes­tic po­lit­i­cal prob­lems its own. It would be con­struc­tive, how­ever, if it re­al­ized that putting too much pres­sure on the gov­ern­ment will lead the coun­try into a new cri­sis which will not aid the econ­omy’s sta­bi­liza­tion and re­cov­ery, which, after all, re­mains its main tar­get.

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