Gov’t drafts plan to secure exit from memorandum

Prime Minister Antonis Samaras was in talks with his aides over the weekend in a bid to finalize Greece’s arguments ahead of a crucial meeting in Berlin on Tuesday with German Chancellor Angela Merkel, from whom he hopes to secure a message of support ahead of the troika’s return to Athens later this month.

Greek government officials have been hammering out a “road map” foreseeing the country’s swift exit from the so-called memorandum with the emphasis on reaching an agreement with the troika without delay so that attention can be focused on resolving political problems on the domestic front.

According to sources, the ideal scenario is that a basic agreement with the troika is reached by early December. The government might then find itself in a favorable position to tackle its key political challenge – garnering the 180 seats in the 300-seat Parliament that it requires to endorse its candidate for president.

With its parliamentary presence at 154 seats, and leftist SYRIZA keen to force early general elections by blocking its candidate, the government is far from the enhanced majority it needs. But sources suggest that a deal with the troika, if reached in good time, could win round many of the independent MPs the coalition is counting on to build support. If the 180 votes appear to be within reach, there is a chance that procedures for presidential elections will be launched as early as January, before President Karolos Papoulias’s term ends in February.

The issue of potential debt relief will take longer to resolve and Athens and Berlin are said to have agreed to put the contentious issue on the back burner until the presidential election issue is resolved.

Nevertheless – even with the thorny matter of debt off the table of talks – reaching a deal with the troika will be no mean task. Athens is reluctant to push forward with the troika’s demands for a second phase of reform of the pension system and additional painful changes to the Greek labor market. Samaras is also keen to get the foreign envoys’ approval for a series of tax breaks that he heralded at the Thessaloniki International Fair earlier this month.

In addition, the two sides have a different view on the matter of fiscal and funding gaps. Government officials have reiterated recently that Greece will not require a third foreign loan program, with Finance Minister Gikas Hardouvelis stating that Greece is in a position to raise some 12 billion euros in outstanding loans from the International Monetary Fund on its own, by tapping international markets. The Fund, which wants to leave Greece, appears to support this position while the European position on the matter remains to be determined.

Samaras and Merkel are expected to discuss the progress of reforms, the role of the troika and the looming problem of political risk during their talks in Berlin on Tuesday. The Greek premier completed a visit to the Azeri capital of Baku on Saturday, declaring that Greece was “upgrading its positions on the global energy map.”

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