ECONOMY

Discreet Tsakalotos tapped to salvage troubled Greek loan talks

Running out of time and money, Greeces hard-left government has reshuffled its EU-IMF negotiating team and given a key role to a Dutch-born moderate economist less likely to irritate the country’s creditors.

Euclid Tsakalotos, a 55-year-old economics professor and junior foreign minister, will keep a close eye on the talks that have made little progress under maverick Finance Minister Yanis Varoufakis.

“Now that we are in the final stretch, we need to reorganise our teams in order to have full control and the best effectiveness possible,” Prime Minister Alexis Tsipras said on Tuesday.

“We need to have better coordination… often there is poor understanding” with EU-IMF negotiating teams, he told Star TV, admitting that there was a “negative climate” towards Varoufakis.

Rotterdam-born and Oxford-educated Tsakalotos, who taught economics at Kent University in Britain between 1990 and 1993 before relocating to Athens, is as discreet as Varoufakis is flamboyant.

Fond of long diatribes, Varoufakis in three short months has managed to irritate several of his fellow European ministers, as well as pick fights with some media whose coverage did not meet his standards.

A self-styled “erratic Marxist”, 53-year-old Varoufakis courted controversy in March when he and his wife posed for celebrity Paris Match magazine inside their beautiful Athens apartment.

The minister was also placed on the defensive that month after being accused of raising his middle finger to eurozone paymaster Germany in a 2013 speech.

Varoufakis insisted that the video footage had been “doctored”.

The final straw came after a stormy Eurogroup meeting in Riga last week where Varoufakis was “isolated” by his fellow eurozone finance ministers according to several reports.

He reacted by quoting former American president Franklin Delano Roosevelt (FDR), the architect of US recovery from the Great Depression.

“FDR, 1936: ‘They are unanimous in their hate for me; and I welcome their hatred’,” Varoufakis tweeted on Sunday.

European Economic Affairs chief Pierre Moscovici commented that Varoufakis “is a smart person, not always easy, but smart.”

On Monday however the Greek government announced that Tsakalotos would head a “political negotiation team” to supervise the talks, and Greeces top negotiator in Brussels — an economist close to Varoufakis — has been recalled.

Privately, European officials could not hide their relief.

“It was a necessary step,” a European source told AFP.

An Athens-based economist, speaking on condition of anonymity, concurred.

“The climate with Varoufakis was so poisoned that it was impossible to move forward,” he said.

“Tsakalotos has a more low-key profile. At this stage it will be a considerable improvement,” the economist added.

Tsipras has sought to sugar the pill, calling Varoufakis an “important asset” to the government and the country.

“The negotiation does not belong to a single person. It never did. The negotiation is always under the responsibility of the prime minister,” Tsipras said.

But even the premier could not resist taking a swipe at his finance minister’s proposal to turn tourists into undercover tax agents.

Promoting the use of credit cards, Tsipras said, “was simpler than that other idea involving people with (hidden) cameras etc.”

Greece has been trying to negotiate a deal that would unlock 7.2 billion euros ($7.8 billion) in remaining EU-IMF bailout money that the debt-ridden country needs to avoid default and a possible exit from the euro.

The radical left government, elected in January on an anti-austerity platform, faces resistance from its creditors to plans to raise the minimum wage, restore collective labour bargaining and divert privatisation proceeds into pension funds.

A survey published Sunday showed that seven out of 10 Greeks want their radical left-wing leaders to reach an agreement with the country’s creditors, and gave Varoufakis an approval rating of just over 51 percent.

[AFP]