Mr Tsipras goes to Moscow

Greece and Russia

The Economist

Playing the Russia card cannot solve Greece's euro zone woes

Apr 7th 2015 | Europe

ALEXIS TSIPRAS, Greece's prime minister (pictured), heads to Moscow this week with his country's future in the euro zone hanging in the balance. Greece's negotiations with its creditors over the release of €7.2 billion ($7.8 billion) of bail-out money are still going nowhere, even as its coffers run dry. The government is raiding state kitties and delaying payments to suppliers in order to meet its obligations to creditors, most urgently a €458m payment due to the IMF on April 9th and €700m in treasury bills held by foreign investors, which are unlikely to be rolled over at maturity next week. But before long it will need a proper financing strategy.

Some Europeans fear that Mr Tsipras thinks Russian money can solve his problems. The EU's 28 member countries must unanimously agree to renew their sanctions on Russia over its aggression in Ukraine before they expire in July. Greece has historic ties to Russia, its largest trading partner, and Mr Tsipras has described the EU's measures as a "road to nowhere". Might he offer Vladimir Putin Greece's veto in exchange for a bail-out?

Probably not, for three reasons. First, Russia's economic problems mean it is not in a position to provide Greece with more than token financial assistance. Second, despite his public bluster, behind closed doors Mr Tsipras has not seriously threatened to undermine the EU's joint position, according to European officials. And third, Europe's leaders will probably discuss whether to extend their sanctions at a summit in late June. Coincidentally, the bail-out extension agreed with Mr Tsipras's government in February will expire a few days after that, and Greece faces bond redemptions in July that it will not be able to meet without further help. Its creditors will not be minded to provide a third bail-out with Greece threatening to blow up the EU's Russia strategy. Mr Tsipras has not proved himself the canniest of operators, but even he must have a better sense of timing than that.

Mr Tsipras's talks in Moscow are instead likely to cover energy and other joint proposals. He may ask Russia to relax its ban on Greek agricultural exports, imposed last year as part of a broader response to the EU's sanctions—although the European Commission would frown on such special treatment. More broadly, Mr Tsipras's visit signals to Greek voters (and MPs) that his government is keeping its geopolitical options open. That irritates its EU partners. But Greece points out, fairly, that Mr Tsipras is hardly a maverick: Matteo Renzi, Italy's prime minister, dropped in to see Mr Putin a month ago.

The bigger problem is that Greece seems no closer to fixing its problems at home, and uninterested in repairing the frayed trust with its euro-zone partners. April 7th brought a double whammy. First Panos Kammenos, the defence minister and leader of Greece's right-wing junior coalition party, warned once again that continued EU "meddling" in Greece would leave it unable to stop the spread of Islamist terrorists throughout Europe. Then Mr Tsipras's government presented Germany with a war-reparations bill of €279 billion (a sum just €40 billion short of Greece's total public-debt stock). These are not the actions of a government that has compromise on its mind.