The Time Has Come To Cut Greece Loose

 06/03/2017 00:48

Dr Ioannis Glinavos
Senior Lecturer in Law at the University of Westminster

The beginning of March saw Athens grudgingly welcome back the “Troika” inspectors. After months of haggling over Greece’s progress towards the goals of its bailout programme and following non-stop negotiations since January 2015, we are back where we started, the creditor inspectors are allowed in to investigate. However, something is different this time. Greece’s cash-for-reforms deal is coming apart while at the same time relationships between its creditors are breaking down. We now face a situation where Greece, the IMF and the Eurozone are operating at cross purposes. It is legitimate to ask therefore whether 2017 will be the year when this all stops. Is Greece still worth saving?

North Korea fires four ballistic missiles into sea, angering Japan and South

Mon Mar 6, 2017 | 3:43am EST

Reuters

By Ju-min Park and Kaori Kaneko | SEOUL/TOKYO
North Korea fired four ballistic missiles into the sea off Japan's northwest on Monday, angering South Korea and Japan, days after it promised retaliation over U.S.-South Korea military drills it sees as a preparation for war.

South Korea's military said the missiles were unlikely to have been intercontinental ballistic missiles (ICBM), which can reach the United States. The missiles flew on average 1,000 km (620 miles) and reached a height of 260 km (160 miles).

Greece's fiscal targets should be eased to help growth, central bank chief says

Sat Mar 4, 2017 | 9:17am EST

Reuters

Greece's international lenders should lower the country's fiscal targets from 2021 onwards to help boost its growth potential, central bank governor Yannis Stournaras said on Saturday.

Stournaras told an economic forum in Delphi that primary surplus targets - excluding debt servicing costs - should be lowered to 2 percent of gross domestic product (GDP) from 2021 onwards from 3.5 percent that is now envisaged.

Carl Bildt: In defence of globalization

World Economic Forum

I must confess that I am a firm believer in the benefits of globalization. To my mind, the gradual interlinking of regions, countries, and people is the most profoundly positive development of our time.

But a populist has now assumed the United States presidency by campaigning on a platform of stark economic nationalism and protectionism. And in many countries, public discourse is dominated by talk of globalization’s alleged “losers,” and the perceived need for new policies to stem the rise of populist discontent.

When I was born, the world’s population was 2.5 billion. I vividly recall a time in my life when many people feared that starvation would soon run rampant, gaps between the rich and poor would grow ever wider, and everything would eventually come crashing down.

Paul Krugman: The Economic Fallout

 By PAUL KRUGMAN

The New York Times

2016-11-09T00:42:44-05:0012:42 AM ET

It really does now look like President Donald J. Trump, and markets are plunging. When might we expect them to recover?

Frankly, I find it hard to care much, even though this is my specialty. The disaster for America and the world has so many aspects that the economic ramifications are way down my list of things to fear.


Still, I guess people want an answer: If the question is when markets will recover, a first-pass answer is never.

Greece Said to Expect Revised Bailout Proposal for Tuesday Talks

by Sotiris Nikas
28 February 2017, 4:03 π.μ. EET
Bloomberg
Greece’s auditors are pulling together a list of policies the country needs to implement to unlock additional bailout funds as they prepare for the resumption of talks with Athens on Tuesday, two people familiar with the matter said.

Greece has asked European lenders for a draft Supplemental Memorandum of Understanding and the International Monetary Fund for a Memorandum of Economic and Financial Policies as it braces for details of creditor demands, the people said, declining to be identified as negotiations between the two sides aren’t public. The government expects an accord in March or early April, but the scale of pending issues raises concerns they may be politically hard to sell at home, they said.

Half of Germans against debt relief for Greece, survey shows

Fri Feb 24, 2017 | 4:05am EST

Reuters

Around half of Germans are against granting debt relief to Greece and around three in 10 want the debt-laden country to quit the euro zone, a survey showed on Friday.

IMF Signals Greek Debt to Be Dealt With at End of Aid Program

by Birgit Jennen
22 February 2017, 8:41 μ.μ. EET

Bloomberg

IMF Managing Director Christine Lagarde signaled that Greek debt restructuring can wait and the country should focus on overhauling its economy for the duration of its latest bailout, which expires in 2018.

Brexit Bulletin: What Can By-Elections Tell Us About Brexit?Bre

Labour is facing a stiff challenge in its traditional heartlands.
by David Goodman
23 February 2017, 9:30 π.μ. EET

Bloomberg

Voters in Copeland and Stoke Central take center stage today in by-elections that will have an impact beyond the borders of the two constituencies.

Both districts have traditionally elected Labour MPs but voted for Brexit, putting it firmly on the agenda during the campaigns, alongside more granular local issues. That, coupled with timing of the polls and the positions of the parties involved, mean they matter more than the average by-election, according to Bloomberg’s Robert Hutton.

Greece Teeters Back to the Edge of the European Union

The bailout program has fallen far behind schedule and is on the verge of falling apart.

The Wall Street Journal

"It is inconsistent to attack the government both for not completing the review and for the measures needed to complete it."


By YANNIS PALAIOLOGOS
Feb. 21, 2017 4:07 p.m. ET
20 COMMENTS
Greece’s Prime Minister Alexis Tsipras has been in a defiant mood lately. Some say it’s just a ploy, others believe he’s sincere. Either way, he could be pushing his country back to the brink of Grexit.

Speaking to his party’s central committee earlier this month, the prime minister had harsh words for Wolfang Schäuble, speaking of the German finance minister’s “constant aggressiveness” against Greece and his “contemptuous remarks” toward the country.

Save Greece by Saving Its Economy First

By THE EDITORIAL BOARD
FEB. 21, 2017


The New York Times

With the Greek government set to run out of cash by the end of July, the country’s main creditors in Europe continue to demand harsh budget cuts as a condition for crucial loans. But after a decade of failing to save Greece, Germany and other European nations, along with the International Monetary Fund, ought to try a different approach, one that makes reviving the economy a priority.

Greece’s creditors appear willing to provide new loans to pay off debts coming due this year as long as the country commits to achieving a fiscal surplus of 3.5 percent of gross domestic product before interest payments by 2018. The I.M.F., more sensibly, has argued for a surplus of 1.5 percent. It also says that European officials should commit to reducing the Greek government’s debt, which is so huge that it equals about 180 percent of the country’s annual economic output. That debt relief could come in various forms, including giving the country more time to repay or reducing the amount owed.

Eurozone Agrees to Greece Talks in Exchange for Bailout Payments

By JAMES KANTER and NIKI KITSANTONISFEB. 20, 2017

The New York Times

BRUSSELS — Eurozone finance ministers agreed on Monday to begin negotiations in Athens as soon as next week over much-needed overhauls in exchange for bailout payments, with Greece appearing to win a reprieve from the crippling austerity that it has faced for years.

The agreement fell short of an all-encompassing deal, with key questions unresolved over the shape of the changes to Greece’s pensions, as well as its tax and labor rules. But it is a positive sign ahead of a meeting this week between Chancellor Angela Merkel of Germany and Christine Lagarde, the head of the International Monetary Fund, who have taken contrasting positions on debt relief toward Athens.

Greece needs 'far less' money than agreed in third bailout: ESM head

Mon Feb 20, 2017 | 3:20am EST
Reuters

Greece will need less in emergency loans from international lenders than originally agreed in its third bailout program due to a better-than-expected budgetary developments, the head of the euro zone bailout fund was reported on Monday as saying.

Klaus Regling told German newspaper Bild that at the end of Greece's money-for-reforms package in August 2018, the European Stability Mechanism (ESM) will "probably have paid out far less than the agreed maximum amount of 86 billion euros" because the Greek budget was developing better than expected.

Schaeuble denies 'Grexit' threat, says Greece on right pathGre

 Sun Feb 19, 2017 | 12:13pm EST

Reuters

By Erik Kirschbaum | BERLIN
German Finance Minister Wolfgang Schaeuble denied on Sunday that he had said Greece would have to leave the euro zone if it failed to implement economic reforms.

Schaeuble said in an ARD television interview that Greece would not have problems if it implemented agreed reforms, but would if it fails to carry these out.

"I never made any ('Grexit') threats," Schaeuble told ARD's Bericht aus Berlin program just before the network played recent comments in which he said Greece was "not yet over the hill" and the "pressure needed to stay on" Greece or it "couldn't stay in the currency union".

Swift deal on Greece needed to avert fresh uncertainty: EU's Dombrovskis

Thu Feb 16, 2017 | 4:45am EST

Reuters

There are costs in delaying agreement on Greece's bailout review, the European Commission's vice president responsible for the euro was quoted as saying on Thursday, and a solution needs to be found swiftly.

Inconclusive talks between Greece and its international creditors on economic reforms and debt relief have cast doubt over the future of Greece's 85 billion euro bailout program.

"There is a common understanding that time lost in reaching an agreement will have a cost for everyone," Valdis Dombrovskis told Greek news portal Euro2day.

EU Sends Envoy to Salvage Greece Deal as February Date Looms

by Eleni Chrepa  and Marcus Bensasson
15 February 2017, 2:00 π.μ.

Greece and its creditors are intensifying efforts to complete a stalled review of the nation’s bailout that would unlock much-needed aid before more than 6 billion euros ($6.3 billion) in obligations come due in July.

EU Commissioner for Economic Affairs Pierre Moscovici met with Greek Prime Minister Alexis Tsipras and Finance Minister Euclid Tsakalotos in Athens Wednesday to try to reconcile differences over what reforms are needed to stabilize the country’s economy. European rescue monitors had wanted a deal reached by Feb. 20 when euro-area finance ministers gather in Brussels.

Germany wants Greece in euro zone, IMF says no special deals

BUSINESS NEWS | Mon Feb 13, 2017 | 5:20pm EST


By Jan Strupczewski and Joseph Nasr | BRUSSELS/BERLIN
Germany on Monday voiced support for Greece to stay in the euro zone and the European Commission dispatched a senior official to Athens to persuade it to take on further reforms to salvage its bailout accord.

International Monetary Fund chief Christine Lagarde, meanwhile, remained firm that as a lender the IMF could not cut any special deals for the crisis-hit country, which has received three bailouts since 2010.

The moves came as the European Commission forecast a large jump in economic growth for Greece of 2.7 percent and 3.1 percent, respectively, this year and next.

Brexit Bulletin: Can Britain Split the Difference?

The U.K. may need to drive a wedge between EU states in Brexit talks. So far the Continent is singing with one voice.
by Simon Kennedy
14 February 2017, 9:30 π.μ. EET

It now looks like Theresa May was a little naive.

Back in October, the U.K. prime minister said she hoped her commitment to start the Brexit process by the end of March would prove enough for the European Union to engage in some “preparatory work” beforehand.

“This is important,” she told the BBC. “It’s not just important for the U.K.; it’s important for Europe as a whole.”

Instead, European officials held their line that there would be “no negotiation without notification” that Britain was definitely leaving.

As Ties With U.S. Cool, Europeans Look to Forge Other Alliances

By GARDINER HARRISFEB. 10, 2017

The New York Times

WASHINGTON — The weather, and her reception here, were far colder than when she visited last summer during the Obama administration, but Federica Mogherini, the European Union’s foreign minister, made it clear that she can handle a chill in the air.

“I think we are entering into a different phase of our relationship,” Ms. Mogherini said Friday in a 30-minute interview, adding, “A more transactional approach means Europeans will be more transactional, and we will base our approach on our interests.”

But Ms. Mogherini said she had received important reassurances from top administration officials on the Iran nuclear deal and on Russian sanctions.

The IMF Staff Has It Right on Greece

FEB 8, 2017 2:00 AM EST
By Mohamed A. El-Erian
Bloomberg

When the International Monetary Fund’s board met Monday to discuss Greece, it was heartening to read that “most Executive Directors” agreed with the staff’s view that the country’s debt, at 179 percent of gross domestic product at the end of 2015, was “unsustainable.” Yet “some directors had different views on the fiscal path and debt sustainability.” This division within the board also applied to what Greece still needs to do with its budget. With the medium-term primary fiscal surplus heading to 1.5 percent of GDP, “most Directors agreed that Greece does not require further fiscal consolidation at this time.” But, again, “some Directors favored a surplus of 3.5 of GDP by 2018.”