Greece had plan to exit euro
FRANK FURT/ATHENS • Already riven by internal conflict, Greece’s leftist government came under further pressure Monday following the release of a recording in which the former finance minister described a secret plan to leave the euro.
The preparations for an alternative banking system and currency began before the current leaders came to power in January, the former finance minister Yanis Varoufakis said in a July 16 interview with an influential investment organization. Alexis Tsipras, leader of the Syriza party and now prime minister, authorized the preparations but ultimately did not put them into action, Varoufakis said.
Publication of the recording, whose contents were reported by the Greek newspaper Kathimerini on Sunday, created a political furor just as representatives of the country’s eurozone creditors were arriving in Athens for talks on a new funding program.
European leaders have been speak- ing with increasing frankness about the possibility that Greece could leave the euro, a topic once considered taboo. Wolfgang Schauble, the German finance minister, had openly discussed Greece temporarily dropping out of the currency bloc, but the proposal was rejected by Angela Merkel, the German chancellor.
Greece is under pressure to agree on a new aid program before Aug. 20, when the country must make a payment of 3.2-billion euros on bonds held by the central bank. Tsipras has been able to pass legislation demanded by creditors only with the help of opposition parties. But the controversy about a eurozone exit plan added tension to an already uneasy alliance.
On Monday, a group of 24 lawmakers from the main conservative opposition party, New Democracy, asked Tsipras to clarify whether he had been aware of the plan to create a new currency. They also suggested that Varoufakis, who resigned earlier this month, should face investigation.
In the recording published Monday by the Official Monetary and Financial Institutions Forum in London, Varoufakis said that beginning in December he convened a team of five people who tried to work out how Greece might drop out of the eurozone and create its own currency.
On the assumption that Greek banks would be closed, the plan called for the government to set up an alternative electronic payment system by piggybacking on a system already used by the country’s tax authority to collect tax revenue. As part of the preparations, a member of Varoufakis’ team hacked into the tax authority’s computer system and copied the software code; the head of the tax authority was considered close to European authorities in Brussels, and Varoufakis didn’t want to alert him to the plan.
On Monday, Varoufakis and the Greek government portrayed the work as a response to the possibility that Greece would be pushed out of the euro.
“Greece’s Ministry of Finance would have been remiss had it made no attempt to draw up contingency plans,” Varoufakis said in a statement on his blog.
“There was never any discussion by the government of any policy foreseeing an exit from the euro,” an official in the office of Tsipras said Monday. “The only thing there was was a study of the repercussions in the event of a Grexit,” the official said, using common shorthand for a Greek exit from the eurozone.