It is more than Greece vs the “Institutions” a.k.a. “Troika”. The small country in Europe’s South-Eastern extremity has already proven to be a catalyst on the political level, highlighting political deficiencies of the European project, especially those created by the inherent controversies of the Eurozone, that can no longer be swept under the purely technocratic carpet.
The concerted attack on Greece’s flamboyant finance minister, Yanis Varoufakis, during the informal Eurogroup meeting in Riga was given extraordinary publicity, following an equally concerted number of “leaks”. It provided a “sexy” story for the media to feast upon, while the real scoop went unnoticed.
Financial Times’ Peter Spiegel had that story this week. As he wrote, during the Riga meeting last month, the head of the IMFs European department, Poul Thomsen warned Eurozone finance ministers that the IMF may hold back its portion of a €7.2bn tranche of bailout aid to Greece (almost half of the total sum) unless European lenders write off a large part of Greece’s sovereign debt, making it sustainable, thus acceptable under IMF regulations.
While both the IMF and Germany’s finance minister, Wolfgang Schaeuble, tried to dismiss this information, some “sources” explained it as “added pressure” on Greece. Others referred to a long-standing disagreement between IMF on the one hand and the European creditors on the other.
But Greece was quick to point out that “the IMF and the EU have 50 different lines each. Under these circumstances it is impossible to reach a serious solution. Let them come to an agreement among themselves and let us know”, said Greek government sources.
In a “non paper” circulated on Tuesday the Athens government blamed the institutions for a impasse in negotiations.
“The serious disagreements and contradictions between the IMF and European Union are creating obstacles in the negotiations and a high level of danger”, it says, noting that while Greece has made proposals towards an “honest compromise”, “the differences in strategy between the institutions create obstacles”.
The Greek government says that the IMF has red lines “especially on pensions and labour” while it is more relaxed on the primary surplus issue. “On the contrary, the Commission has red lines on primary surplus” and is more relaxed on pension and labour reform.
“The result is that all the institutions have red lines everywhere. Pensions, labour (IMF) and primary surplus (Commission). Under these circumstances there can be no compromise. The responsibility lies with the Institutions and their inability to reach an understanding between themselves”.
This can be interpreted as an attempt of the Greek government to complement the “chicken game” played with the “Institutions”, according to some, with a “blame game” where each side is trying to dodge eventual blame for a potential disaster.
It can also be seen as another attempt by the IMF to shake both Greece and the European part of the Institutions (but mainly Berlin) into contact with reality.
But others see a different picture, a geopolitical tug of war across the Atlantic, frequently describing the IMF as being under US influence and used by Washington in order to keep Brussels (and Berlin) in line.
Last Monday, the president of the European Commission, Jean Claude Juncker, seemed to allude to something like that. Speaking at the Catholic University of Leuven about the possibility of a “Grexit”, he said that “Grexit is not an option. If Greece would accept it, if the others would accept it, that the country would exit the zone of security and prosperity constituted by the eurozone, we would be exposed to huge danger, because the Anglo-Saxon world would do everything to try to decompose, at a regular rhythm, by the sale, piece by piece, of the Eurozone.”
What is particularly telling is the use of the term “Anglo – Saxon world” regarding the decomposition of the Eurozone, in contrast to other parts of his speech when he referred specifically to “Britain” in a different context.
http://www.neurope.eu/article/a-free-for-all-around-greece/