With the EU already disintegrating under the weight of a US/UK created refugee crisis, Greece’s re-elected PM, Alexis Tsipras, is out with more promises to save the country he betrayed by signing the memorandum number 3 only a few months ago.
Tsipras 1.0 was all about destroying EU austerity.
Tsipras 2.0 was all about how he saved the country by having to sign the most brutal austerity program to date.
Tsipras 3.0 seems to be about cutting Greece’s massive debt with the zero leverage that SYRIZA commands over Greece’s German rulers.
SYRIZA said on Sunday it plans to govern in a coalition with the small right wing Independent Greeks party, the same partner Tsipras chose after winning the country’s previous general election in January.
But to strengthen his hand in talks with EU partners over how to ease Greece’s debt burden, he will seek a broader consensus among the parties he defeated on Sunday, the party source said.
“We will continue negotiations in the coming period, with the debt issue being the first and most important battle,” the source said. “We will ask all political forces to support our efforts.”
Some European governments, particularly Germany, are opposed to cutting Greece’s debt – a so-called haircut – but not averse to stretching out its repayment schedule.
Eurozone officials told Reuters last week that governments are ready to cap Greece’s debt-servicing costs at 15 percent of GDP annually over the long term. That would mean the nominal payment would be lower if the Greek economy struggled, higher if it was more robust, they said.
Tsipras is also planning to form a national council for European policy, including representatives of parties other than the Independent Greeks and which would advise the finance minister, the SYRIZA source said.
Centre-left daily newspaper Ethnos tipped Euclid Tsakalotos, the former finance minister who brokered terms of the bailout accord in August, to be re-appointed. JP Morgan analyst Malcolm Barr said he expected some sort of debt restructuring to be in place by early next year.
“We continue to think that… the (bailout) programme will make enough progress to allow a restructuring of loans from euro area countries by the end of the first quarter of 2016,” he wrote in a note.