Greek government debt ‘compromise not what SYRIZA wanted’

Euronews, 23.06.2015

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Inching towards debt redemption, the negotiations between Greece and its emergency lenders have raised the occasional mention of the word ‘Grexit’ over the past few months — but quietly, because if they failed it could hardly be good for the euro. [...]

Janis Emmanouilidis, Director of Studies and Head of Programmes at the European Policy Centre in Brussels, spoke to Efi Koutsokosta about the challenges still ahead.

Efi Koutsokosta, euronews: It’s the first time after five months of this Greek drama that it seems that we are very close to an agreement. Do you see finally a fair compromise?

Janis Emmanouilidis: Obviously, the Greek government had to give in on many issues; it’s not really linked to what they had proposed before the elections – that includes a lot of measures to increase taxes in order to increase income. So it’s a compromise, which, seen from the Greek perspective, is not one that reflects what the Greek government, what SYRIZA had wanted, but more reflecting what the partners had asked for. It is a compromise in a difficult situation, but if there is no compromise, the outcome would probably be much worse.

euronews: There is still no agreement. What should we expect over the next two days, until the Eurogroup meeting on Wednesday?

Emmanouilidis: There is one question in the air which needs to be settled, which is also something that the IMF was strongly pushing towards, which is debt sustainability. Will it be some kind of reference to the level of Greek debt, to whether the issue will be taken up in the future? However, a reference which goes beyond what was already promised at the end of 2012 was that debt sustainability will be something which is going to be analysed and checked.

euronews: [IMF chief] Christine Lagarde said that there is still a lot of work to be done. Is it possible that the IMF could no longer be on board for the next agreement?

Emmanouilidis: I think this is very difficult. If you look at key players, especially Berlin – also others but especially Berlin – they are very eager to have the IMF on board and they are still very eager to have the IMF on board.

So, I think the chances are strong that the IMF will, in the end, be part of this but, again, this is not the end of the Greek saga; there will be a continuation because there is more to come and the IMF certainly also plays a role.

euronews: The Greek government has made a lot of concessions on the way to an agreement. Is it going to be easy to convince the people back home?

Emmanouilidis: This is the next step. In a way, after negotiations the ball will be in the Greek court. There will have to be discussions within SYRIZA, within the government, with the independent Greeks, as they want a majority in parliament to get it through. This will not be easy.

On the other hand, it seems there is some opposition but they still have a majority of 12 members of parliament; the question is, will they be able to defend their majority? I think that there are chances that it will happen but it won’t be easy.

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