Moscovici backs Athens, warns of risks to stability

A potential return of the threat of a Greek eurozone exit would be “a pity,” European Economic Affairs Commissioner Pierre Moscovici said Monday during a visit to Athens, the first since he was appointed to his new post last month.

After talks with Prime Minister Antonis Samaras, Finance Minister Gikas Hardouvelis and other key cabinet officials, Moscovici praised the “huge progress” made by the Greek authorities over the past few years. However, when asked by reporters whether the “danger of ‘Grexit’ is out of the picture,” the former French finance minister indicated that it was not. Noting that efforts by the government, and the Greek people, in the direction of fiscal adjustment, “are beginning to bear fruit,” Moscovici said, “it would be a pity not to go on.” Also, in an apparent swipe at opposition SYRIZA, which is aiming to seek a writedown of the country’s debt, Moscovici remarked that “belonging to the eurozone is a matter of obligations.” “Contemplating the possibility of not reimbursing a huge debt is suicidal,” he added. “It is not possible. It would mean default,” he said.

Earlier in the day, EC spokeswoman Mina Andreeva had stressed that Greece’s membership of the eurozone remained “the only viable solution.”

Notwithstanding Greece’s progress in imposing economic reforms demanded by creditors, Moscovici stressed the importance of “structural reforms,” not only in Greece but in other eurozone countries. He said his key goal was to contribute toward finalizing a review of Greece’s economic reforms so that the European involvement in the country’s bailout can be completed and the two sides can “move to another relationship.” He did not elaborate on the details of a likely post-bailout relationship between Greece and its euro partners but noted that, apart from a European credit line currently under discussion, there could also be “a precautionary program with the IMF.”

Meanwhile, ahead of Wednesday’s first vote in the three-round presidential election, tensions between co-ruling New Democracy and leftist SYRIZA peaked with each side blaming the other for destabilizing the country and raising the specter of so-called Grexit.

SYRIZA leader Alexis Tsipras and key cadres close to him suggested that the premier might set up a bank run as part of a broader scaremongering campaign aimed at getting MPs to back his candidate for president.

“Samaras is capable of staging a bank run with an artificial capital flight organized by friendly entrepreneurs in order to render his argument more convincing,” the leftist leader said.

Tsipras’s comments prompted an angry response by State Minister Dimitris Stamatis, who described the leftist leader as “dangerous,” noting that he insisted on “dragging the country to elections, in clear contempt of the will of the Greek people,” an apparent reference to the narrowing lead of SYRIZA over Samaras’s New Democracy.