The deadlock at the euro area finance ministers’ meeting in Brussels in the early hours of Wednesday was a resounding defeat in terms of the expectations held by Greece’s conservative-led coalition government and of the majority of the Greek people, who rightly wish to see the debt-wracked country remain in the common currency zone.
Following lengthy negotiations with the troika of foreign lenders, the controversial parliamentary vote on a fresh package of stiff austerity measures and the further decline in the parliamentary power of the three coalition partners, it was expected that Greece would be better rewarded.
The Eurogroup proved that our partners in the European Union and the International Monetary Fund have their own, sometimes contradictory, interests to look after. Furthermore, it is easy to see that these interests have little to do with a vision for a more firmly unified Europe. Rather, they are all about financial technicalities.
Next Monday, eurozone ministers and the IMF will most likely reach an agreement that will guarantee Greek debt sustainability. But only a part of this will fall on the shoulders of our European peers, as the Greek people will once more have to shoulder the additional cost.
However, it was not just political expectations that went unfulfilled at the Eurogroup summit. Greece’s business elite also appears to have received a severe blow. The terms of the recapitalization of local lenders, which include the appointment of independent commissioners at Greece’s major banks, mean that the senior management of these institutions will no longer play the critical role it did over the last decades.
Developments in the banking sector look like they be fatal for those companies that have managed to survive by virtue of their “special relationship” with the country’s political and economic class.
It would be absurd if the status quo that emerged following the end of the military dictatorship in the mid-1970s were to escape unscathed from the present economic meltdown. The powers on the edges of Greece’s ideological spectrum are rolling up their sleeves and getting ready to play a more decisive role in developments – an eventuality that no one could have predicted, or wished for, only a few months ago.
Greece would probably have been better off had it not gone to elections in both May and June. But observations of this kind are, after all, inconsequential.