European Commission President Jose Manuel Barroso spoke to Antonis Samaras and Evangelos Venizelos in private in November 2011 and encouraged them to block George Papandreou’s proposal for a referendum on Greece’s euro membership, a Financial Times report claimed on Monday.
The article, written by Brussels-based journalist Peter Spiegel, describes how the eurozone crisis came to a head in late 2011 after Papandreou, then Greece’s prime minister, proposed a referendum on whether Greeks were prepared to accept their bailout terms.
Spiegel describes how Papandreou came under pressure from then French President Nicolas Sarkozy and German Chancellor Angela Merkel to abandon the idea or to at least make euro membership the subject of the referendum.
One of Sarkozy’s aides said the French president went “ballistic” when he heard Papandreou’s plans but was advised that he could not prevent the Greek leader from holding the plebiscite because it would be Gaullist traditions.
Instead, Sarkozy and Merkel decided to invite Papandreou to the G20 summit in Cannes at the beginning of November to persuade him to hold a referendum on whether Greece should remain in the euro.
“Mr Sarkozy summoned his fellow leaders to the Palais at 5.30pm on Wednesday, an hour before they were due to meet Mr Papandreou, to agree on how to confront him,” reports the Financial Times. “Those invited included Ms Merkel; Jean-Claude Juncker, the Luxembourg prime minister who chaired the eurogroup of finance ministers; Christine Lagarde, managing director of the International Monetary Fund; and the EU’s two presidents, José Manuel Barroso and Herman Van Rompuy.”
At the meeting a six-point plan was agreed and then presented to Papandreou. “The idea was to put Papandreou against the wall, in the corner,” one of the people in the room told Spiegel.
Papandreou described Sarkozy as “ranting and raving” about the referendum.
“The position of Sarkozy was very offensive,” Venizelos, who was then finance minister and accompanied Papandreou to the meeting, told the FT journalist. “It was not polite. Very, very strong and very offensive, in order to put Greece in a dilemma: in or out.”
Merkel backed Sarkozy and Papandreou left the meeting to announce to reporters that the vote would be on whether Greece would remain in the euro.
According to the report, Barroso spoke to Venizelos in private after the meeting and impressed upon him that the referendum should not take place because it could severely dent confidence in the eurozone,
“We have to kill this referendum,” Barroso is reported as saying. Venizelos agreed.
Earlier the European Commission president reportedly spoke to Samaras, then New Democracy leader, and shared this though with him. As opposition leader, New Democracy had followed a staunch anti-austerity line and attacked Papandreou and PASOK for signing the bailout.
Samaras, however, became worried that a referendum would put him in a difficult position as he would have to side with Papandreou. The opposition leader, therefore, told Barroso that he would be willing to join an emergency government to prevent the vote taking place.
“Mr Barroso summoned his cabinet and other commission staff to his suite at the art deco Hotel Majestic Barrière to plot strategy,” reports the Financial Times.
“He decided he would not tell Mr Sarkozy or Ms Merkel of the conversation but according to people in the room, they began discussing names of possible technocrats to take over from Mr Papandreou in a national unity government. The first person to come to Mr Barroso’s lips was Lucas Papademos, the Greek economist who had left his post as vice-president of the ECB a year earlier. Within a week, Mr Papademos would have the job.”
On the flight back to Athens, Venizelos penned a statement opposing the idea of a referendum and then went to hospital with stomach problems. Within days Papandreou had stepped down as prime minister and Papademos was installed as the head of a three-party interim government including New Democracy.