Draghi urged Greece to allow officials back before it’s too late

European Central Bank President Mario Draghi told Greek officials they face a critical situation and must let euro-area representatives return to Athens if they are ever going to obtain more aid, according to two European officials.

Draghi told Greek Finance Minister Yanis Varoufakis at a meeting on Monday in Brussels the government’s books needed to be examined to determine its financing shortfall, said the people, who asked not to be named because the conversation was private. Representatives from the European Commission and International Monetary Fund had a similar message, one of the officials said.

Greece agreed to allow experts representing the commission, ECB and IMF to start work in Athens on Wednesday, the Netherlands’s Jeroen Dijsselbloem said, after chairing the meeting of euro-region finance ministers.

Spokesmen for the ECB and for Varoufakis declined to comment when reached on their mobile phones.

With financial markets closed, and the central bank keeping its banks on a tight leash, the Greek Treasury could face a cash crunch in one, two or three weeks, a different euro-area official said Monday. Without getting access to the books, it’s impossible to know for sure, the official added.

Balancing act

Prime Minister Alexis Tsipras is trying to access European bailout funds for Greece without completely ditching the anti-austerity agenda that won him election seven weeks ago. So far he’s dropped demands for a writedown on Greek debt, abandoned his plan to halt privatizations and accepted that he won’t get “bridge financing” without signing up to conditions.

In return he’s won concessions to shift some meetings to Brussels and persuaded European officials to describe the country’s official creditors as “institutions” rather than “the troika.”

“The troika is a cabal of technocrats that used to arrive in Athens and enter the ministries with a kind of power play that smacked of a colonial attitude,” Varoufakis said at a press conference after the meeting. “That practice is finished. We shall endeavor to do whatever it takes to provide the institutions with whatever information they need.”

Greece won’t get any more cash from its 240-billion-euro ($260 billion) rescue program until its official creditors are satisfied that Tsipras is committed to all the economic fixes needed to meet its conditions, Dijsselbloem said.

It’s impossible for Greece’s creditors to adequately audit the government’s accounts without sending officials to Athens, a troika official said. The government would need to fly hundreds of Greek officials to Brussels for the work to be done there, he added.

Draghi’s deal

As Draghi pressed Varoufakis to accept the return of the troika officials, the minister said that the idea that Greece was opposed to such a move was a misunderstanding, according to one of the officials with direct knowledge of the exchange.

Can they start soon? Draghi asked. Varoufakis agreed. Wednesday? And the deal was done.

“If Greece wants that, one can of course negotiate with the three institutions which we should no longer call the troika, but which is the troika,” German Finance Minister Wolfgang Schaeuble said February 11.


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