Crucial deliberations on a tightrope

The fate of the country is at a particularly critical juncture in view of the Eurogroup meeting on Monday against the backdrop of the continuing pressure from the partners for increasing commitments on the part of Athens, which will offer assurances to our lenders within a framework of political change after the elections.

The partners have tabled a range of issues: from the placement of a Commissioner with responsibilities especially for Greece to strengthening the Troika with executives who will comprise an expanded monitoring mechanism of reforms and the execution of the budget, as well as the granting of a bridge-loan which would ensure that the country will not default until elections take place, the implementation of which is not desired by Berlin.

At the same time, the partners are denying that the debt can reach sustainable levels in 2020 - they estimate a rate near 128% of the GDP - and are blaming Athens for failure to effect structural change.

In this climate, the scheduled House debate on the debt “haircut” was postponed, obviously because the government does not want to see an escalation before the Eurogroup, at a time when the partners would like commitments even from leftist parties.

In the context of said developments, PM Lucas Papademos, PASOK president George Papandreou and President of the New Democracy party Antonis Samaras met today.

The main purpose of the meetings was to inform the leaders of both parties who support the government on the ongoing contacts with European partners on the new economic program, the loan agreement and the PSI.

Athens now is showing slight optimism as to the PSI approval by the Eurogroup on Monday to begin the process of bonds exchange. Speaking after the meetings of the PM with Papandreou and Samaras and asked on the heavy climate emanating from Berlin, government spokesman Pantelis Kapsis stated “I have nothing to say to Mr. Schauble, it is up to us completely when we will hold elections”.

He added that besides Mrs. Merkel, the PM will have spoken with other EU leaders by Monday. At the same time, he stated that the issue of a special account required by various countries to pay the amounts from the Greek rescue plan, remains open.