Rifts open in gov?t over reforms

As Prime Minister George Papandreou discussed the crisis in Libya with fellow heads of state in Paris on Thursday, political upheaval in Athens peaked as several of his key ministers squabbled over reforms that foreign creditors have said are crucial to nurse the economy back to health.

One of the most high-profile clashes involved Administrative Reform Minister Dimitris Reppas and Transport Minister Yiannis Ragousis who have been embroiled in a dispute over plans to liberalize the taxi drivers? sector – one of dozens of so-called ?closed professions? Greece has pledged to open.

In comments to Radio Ennea, Reppas noted that ?some people should not invoke the memorandum and the troika,? a clear dig at Ragousis, who succeeded him at the Transport Ministry and overhauled legislation regarding the taxi drivers.

Reppas, a veteran of the old guard of Socialist PASOK, also lashed out at other cadres perceived as selling out on the party?s original ideals. ?A PASOK government must be opposed not only to statism and patron-client relations but also to the unfettered free market capitalism that pulls society apart,? he said.

Another rift, that was more surprising as it emerged during a press conference, involved Interior Minister Haris Kastanidis and Labor and Social Insurance Minister Giorgos Koutroumanis. Quizzed by reporters about recruitment in the public sector, Kastanidis distanced himself from Koutroumanis, noting that hirings should be made exclusively through the Supreme Council for Civil Personnel Selection (ASEP) and not through local officials.

The tensions provided fertile ground for the main opposition New Democracy to intensify its criticism of the government. ND spokesman Yiannis Michelakis described the squabbling as ?comic farce that surpasses the imagination.?

In a related development, it emerged that the finance ministers of Germany, Finland and the Netherlands are to meet on Tuesday to discuss a problem that has threatened to scupper a fragile consensus on Greece?s second bailout – Finland?s insistence on guarantees from Greece. Amid speculation that Finland will revert to its original demand for state assets to be put up as collateral for loans – a demand Athens has dismissed – Finance Minister Evangelos Venizelos insisted that the matter will have been resolved by mid-September.

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