Gov’t puts positive spin on Eurogroup agreement


The government sought on Tuesday to put a positive spin on an agreement reached between Greece and its international creditors at Monday’s Eurogroup, insisting that any increase in financial burdens on Greeks would be offset by countermeasures.

“For every euro that burdens [citizens] there will be a euro in relief,” government spokesman Dimitris Tzanakopoulos told a media briefing in Athens. He did not determine what the measures or countermeasures would be though the package is widely expected to include a broadening of the income tax base and further cuts to pensions with some reductions to other taxes as a concession. He admitted, however, that “we may need to make cuts from somewhere else” if Greece misses its budget targets.

Commenting from Brussels, German Finance Minister Wolfgang Schaeuble was more direct. “I understand that for political reasons, Greece cannot proceed with new reforms to pensions, but that doesn’t mean that this cannot happen later,” he said, adding that the measures to go to a vote in Greece’s Parliament would not come into effect until 2019.

In his comments, Tzanakopoulos called on Germany to drop its “irrational demands” that Greece post a primary surplus of 3.5 percent of gross domestic product for a decade. Tzanakopoulos also enjoined Berlin to “adopt a constructive stance” on Greece’s efforts for debt relief.

The meeting in Brussels “set out the basic principles that will underpin a technical agreement.”

On Wednesday, all eyes are on Berlin, where German Chancellor Angela Merkel is to receive International Monetary Fund chief Christine Lagarde and European Commission President Jean-Claude Juncker, in separate meetings, to discuss the Greek program.

The meetings come after the IMF agreed to send technical inspectors back to Athens next week to resume talks with European and Greek officials though it remains unclear whether the Fund will join Greece’s third bailout.