BRUSSELS ? Some eurozone countries have strong doubts over whether a second massive bailout can actually save Greece, officials said Wednesday, even as Athens rushed to meet tough conditions to qualify for the euro130 billion ($170 billion) rescue.
The wrangling over Athens' aid money comes after almost two years of frantic efforts to save Greece from bankruptcy and secure its place in the 17-country currency union.
But circumstances have changed since the eurozone agreed on a first euro110 billion rescue for Greece in May 2010.
Several politicians ? especially in rich euro countries like Germany, the Netherlands and Finland ? have grown tired of Greece repeatedly missing budget targets and failing to implement promised cuts, reforms and sales of state assets. The measures that have been put into practice, meanwhile, have pushed the country into steep recession, with its economy shrinking 7 percent in the final quarter of 2011 from a year earlier.
At the same time, some policymakers are optimistic that the eurozone is now strong enough to handle a default by Greece, which is one of the smallest economies in the currency union, responsible for only about 2 percent of its economic output. Other lawmakers, however, are concerned that the shockwaves of a disorderly Greek default would be felt across the rest of Europe and the world's financial markets.
"There are many in the eurozone who don't want us any more," Greece's Finance Minister Evangelos Venizelos told the country's president, Karolos Papoulias, during a meeting to inform him of the latest developments. Greece, Venizelos added, had to persuade the skeptics that the country could stay in the currency union and regain lost ground in reforming its economy.
"We are facing a situation that is particular because we are constantly being given new terms and conditions," the finance minister said.
Venizelos' negative assessment was backed by an official in Brussels.
"There is resentments, mistrust, really bitter debate," said a European official, who has been briefed on recent talks between eurozone finance chiefs. The official was speaking on condition of anonymity because of the sensitivity of the topic.
In Berlin, German Chancellor Angela Merkel's spokesman, Steffen Seibert, sharply rejected a question about market rumors that Germany has decided a Greek bankruptcy is acceptable.
"I can say very clearly for the German government that these rumors are wrong ? there is no such decision by Germany," he said, adding that Germany is working with others in Europe to find "a practicable way out of the crisis for Greece" with the second rescue package and a bond swap with private creditors that seeks to cut Greece's debt by about euro100 billion ($130.92 billion).
However, tensions between Athens and its creditors remain. A meeting between eurozone finance ministers planned for Wednesday was canceled Tuesday night after Athens failed to deliver in time on demands made the previous week. Eurogroup chairman Jean-Claude Juncker said he was still missing details on how to save an extra euro325 million ($428 million) as well as written assurances by main political party leaders that they will stick to a second bailout program after elections expected for April. The ministers will hold a conference call Wednesday evening instead, and meet on Monday.
Officials said the euro325 million ($428 million) should be secured by the end of the day. On the written assurances, Socialist party head George Papandreou sent his letter Tuesday night, officials said. Conservative party leader Antonis Samaras sent his Wednesday.
"We will remain committed to the program's objectives, targets and key policies," wrote Samaras, whose party is most likely to win elections expected in April. However, he said policies might have to be modified in order to help the economy recover from the deep recession it is currently in, although he underlined these would not change the ultimate targets in reforming the economy.
But the European official briefed on recent talks said even those assurances may not be enough.
"People don't trust the Greeks and that is the main element," he said.
Adding to that are concerns that the upcoming election campaign will forcibly slow down or hinder implementation.
At their most recent get-together last week, finance chiefs lashed out at their Greek colleague, with Finland's Finance Minister Jutta Urpilainen chewing Venizelos out in front of the cameras over a documents she said still had not been signed.
The perceived humiliation of Greece and the hardship brought on by four years of recession have often sparked violent protests in Athens and other Greek cities as well as growing resentment against Germany and the EU, which seen as imposing unnecessarily painful cuts.
On Wednesday, a woman identified as an engineer in her 30s working for the Workers' Housing Organization, one of the public bodies to be closed, stood on a window ledge of the office building and threatened to jump.
"We have a huge problem here," said Harris Gouvropoulos, a workers' representative on the board of the organization that helps workers on low salaries obtain housing. "They have not understood the extent of the problems they have created by shutting down this organization."
After more than four hours, negotiators talked the woman off the window ledge.
Politicians in Athens and Brussels have warned about the negative consequences of a default.
"We do not have a choice between a pleasant or unpleasant option ? but a choice that is between either unpleasant or even more unpleasant solutions," Venizelos said.
But there are still doubts as to whether the bailout will work.
When eurozone leaders tentatively agreed on more aid last October, they pinned down key parameters: By 2020, Greece's debt has to decline to 120 percent of economic output ? the maximum they said was sustainable ? from more than 160 percent currently.
But even with the bailout and the bond swap, the 2020 target could still be missed. Last month, an EU official said a gap of some euro15 billion ($19.6 billion) remained. There are hopes that the European Central Bank, which also holds a substantial amount of Greek bonds, can help fill that gap, but so far the ECB has remained vague on whether and how it would do so.
__
Becatoros reported from Athens, Greece. Derek Gatopoulos and Eftehia Katsareas in Athens, Gier Moulson in Berlin and Raf Casert in Brussels contributed.
washington redskins doritos confederate flag confederate flag kim delaney kim delaney dead sea scrolls
No comments:
Post a Comment
Note: Only a member of this blog may post a comment.