Greek anti-austerity party Syriza’s resounding election win on Sunday leaves the European Union caught between finding a compromise with its leader Alexis Tsipras and making concessions that will be hard to swallow for countries like Germany, analysts said.

Having won over a frustrated Greek public with fighting talk of renegotiating the country’s 240-billion-euro ($269 billion) rescue package and leaving behind years of painful spending cuts, Tsipras has put himself firmly on a collision course with Brussels.

There will be plenty of “tense” moments between Athens and Brussels in the weeks to come, a top European official said, not wishing to be named.

“We will not escape a re-negotiation (of the bailout),” another European source told AFP on Sunday.

The first indications of the EU’s reaction will come on Monday, with a long-scheduled meeting of eurozone finance ministers, where talk of Greece’s unsustainable debt level will top the agenda.

“It’s definitely an important victory for Syriza. Now we have to see what Tsipras will propose,” said Italy’s EU affairs minister Sandro Gozi.

There will also be close scrutiny of Germany’s response, the country seen as the driving force behind the bloc’s austerity drive.

German Chancellor Angela Merkel and Syriza are on track “for an exciting game of poker”, said Julian Rappold, an expert on European politics at the German Council on Foreign Relations think tank, adding that Tsipras’s victory could have wider European repercussions.

“The path of no alternative as presented by Merkel could be called into question,” he said. “There will have to be a concession (from Berlin).”

ALSO READ  The European Union sends a strong message against Turkish provocations

The clock is ticking for urgent action to tackle Greece’s mountain of debt, with a two-month extension from creditors — granted to conclude an audit that will determine the release of the next tranche of some seven billion euros in loans — due to expire on February 28.

– ‘We must reduce debt’ –

French Finance Minister Michel Sapin has already said the EU should be open to discussions with the new Greek government on restructuring its debt or extending the bailout terms.

Aside from wanting to renegotiate his country’s massive bailout by the EU and International Monetary Fund, Tsipras has said he will immediately seek a 50-percent reduction in Greece’s debts that have ballooned to 318 billion euros.

While that may seem optimistic, experts say the idea of reducing Greece’s debt — once off-limits — is now gaining ground.

“We must reduce this debt, for instance by extending the duration of the loans and further reducing the interest rates on certain loans,” economist Jacques Sapir told the French daily Liberation.

“In exchange, Athens will have to implement structural reforms. That is what the discussion with Syriza will be about,” he said.

It would be a mistake to refuse to reduce Greece’s debt, agreed Paul De Grauwe of the London School of Economics, as this would “condemn Greece to several difficult years and encourage extremist political movements… that could strongly shake up the eurozone as a whole”.

After conceding defeat, outgoing Greek Prime Minister Antonis Samaras on Sunday said he hoped the new government would not endanger the country’s EU and euro membership.

ALSO READ  Provocation against Greece - Turkey holds new Navy exercise in the Mediterranean Sea

“I hand over a country that is part of the EU and the euro. For the good of this country, I hope the next government will maintain what has been achieved,” Samaras said in a solemn acceptance of defeat.

 

AFP

Share this article:
  •  
  •  
  •  
  •  
  •  
  •  
  •  
  •  
  •  
  •  
  •  
  •  
  •  
  •  
  •  

Notice: All comments represent the view of the commenter and not necessarily the views of AMN.

All comments that are not spam or wholly inappropriate are approved, we do not sort out opinions or points of view that are different from ours.

This is a Civilized Place for Public Discussion

Please treat this discussion with the same respect you would a public park. We, too, are a shared community resource — a place to share skills, knowledge and interests through ongoing conversation.

These are not hard and fast rules, merely guidelines to aid the human judgment of our community and keep this a clean and well-lighted place for civilized public discourse.

Improve the Discussion

Help us make this a great place for discussion by always working to improve the discussion in some way, however small. If you are not sure your post adds to the conversation, think over what you want to say and try again later.

The topics discussed here matter to us, and we want you to act as if they matter to you, too. Be respectful of the topics and the people discussing them, even if you disagree with some of what is being said.

Be Agreeable, Even When You Disagree

You may wish to respond to something by disagreeing with it. That’s fine. But remember to criticize ideas, not people. Please avoid:

  • Name-calling
  • Ad hominem attacks
  • Responding to a post’s tone instead of its actual content
  • Knee-jerk contradiction

Instead, provide reasoned counter-arguments that improve the conversation.