Economic growth, social cohesion and asylum policy are the top priorities. Stournaras: “We can’t hold the EU presidency and have unresolved issues with the troika”
Athens.- On January 1, 2014, Greece will begin its term as rotating EU president. Despite its ongoing economic woes, the country is adamant it will be an “honest broker” at the head of the EU during the next six months.
At a presentation of Athens’ top priorities during its six months at the head of the EU, Prime Minister Antonis Samaras said economic growth, social cohesion and asylum policy would be paramount. The Greek head of government also said that the completion of the European banking union would be given due attention.
With regard to economic growth, Greece’s coalition government of Conservatives and Socialists intends to provide an example for its EU partners, promising to leave the recession behind that has plagued the country for years.
However, few believe at this stage that Athens can make good on those pledges. Critics have even questioned whether the decision to place Greece in the chair of the European Council was a good one – in the face of its still withered economy.
Get out the polish…
Despite its ongoing crisis, Greece will deliver a solid presidency, said Panagiotis Ioakeimidis, professor for European policy at the University of Athens. It’s the least the country could do to improve its image within Europe and restore the credibility it has lost in recent years. “And I think this is exactly what will happen,” Ioakeimidis told DW.
This confidence is shared by the Socialist EU parliamentarian Sylvana Rapti, who is a close aide of Greek Foreign Minister Evangelos Venizelos. She is annoyed by skepticism as to whether Greece can function as EU chair: “Such distrust is born out of malevolence,” an emphatic Rapti said in an interview with DW.
“Let’s not forget: Belgium had to fight against such sentiments during its EU presidency in 2010. They didn’t even have a government back then, and still they performed well; their crisis didn’t affect Europe in the least,” she added.
Social policy in focus
This will be Athens’ fifth run in the rotating EU presidency; and, like before, Athens will continue to work for a socially conscious Europe, even if their successes have been moderate in the past.
In 1988, for instance, Andreas Papandreou pushed for a European Social Charta, which only a year later was passed under the French EU presidency. In 1994, Athens’ social agenda was set aside in the face of negotiations for an enlargement of the EU to the north. In 2003, the Greek EU presidency was completely shadowed by the Iraq crisis and divisions within Europe that emerged as a result.
In the coming year, Athens is looking once again to promote social cohesion within Europe. In particular, the government wants to devote attention to youth unemployment and ways the EU can subsidize the transition of young people into jobs. And this time attempts may not be in vain, says Sylvana Rapti.
Calls for a more social Europe are growing in frequency and intensity, she adds. Those who have long opposed the movement are becoming isolated, and not only in crisis-ridden Greece. “The time has come for a change in politics in all European countries, including those wealthy nations like Germany, France and Great Britain – where the people likewise yearn for a more social Europe.”
approach to refugees
“This presidency will be about Europe, and not just Greece,” agrees Ioakeimidis of Athens University. The researcher knows what he is talking about: as an advisor to the Greek foreign office, Ioakeimidis was part of each of Greece’s five stints as EU chair. In 2003, he was in charge of advising Costas Simitis on Greek policy in Europe.
Ioakeimidis is certain that asylum policy will play a decisive role in the upcoming presidency. But even here, it will be impossible to avoid a conflict of interest: “In the past, the Greek presidencies worked on the Dublin Regulation [Ed. note – a law regulating the asylum application process] despite the fact that the Greek government was against it. They feared it would force the countries on the Europe’s periphery to take on responsibility for refugees.”
Although Ioakeimidis doesn’t believe that Athens will attempt to amend the Dublin Regulation, per se, he does think European asylum policy could be improved: “A reinforcement of the border control agency FRONTEX will most certainly be on the agenda, as well as negotiations with the newly implemented EU working group for Mediterranean members,” said the Athens-based European expert.
Talks with troika
Amid a tense political climate, and with the country’s assumption of the European Union’s rotating presidency looming, government officials are already preparing for the return of troika officials in the middle of next month, Kathimerini understands.
Finance Minister Yannis Stournaras, whom Prime Minister Antonis Samaras has repeatedly backed despite growing criticism by many coalition deputies to an ongoing austerity drive, appears keen to complete the next round of economic reforms pledged to the troika before a Eurogroup summit on January 27.
In addition to the next tranche of rescue funding, a sum of 4.9 billion euros, the scheduled takeover of the EU presidency is a strong incentive.
“Greece can’t hold the EU presidency and have unresolved issues with the troika,” Stournaras said.
“We’ll be trying to push for banking union and someone will disagree and bring up the issue of the troika and our negotiations,” he said, adding that “we definitely have to wrap them up.”
Troika envoys are expected to be in Athens on January 13, Kathimerini understands, and not on January 8 when Athens is scheduled to welcome EU officials for an official ceremony to assume the bloc’s presidency.
The key issues on the agenda of talks are expected to be a projected fiscal gap for 2014, which the troika estimates at around 1.4 billion euros, and the progress of a delayed overhaul of the civil service, as well as lagging tax collection and a slow-moving privatization drive.
According to sources, there was annoyance in the ranks of the troika – particularly on the side of the International Monetary Fund – at the government’s unilateral decision to extend a 13 percent tax on restaurants and food services, which was reduced from 23 percent in the summer in a bid to boost the tourism sector and languishing small businesses.
A high-ranking European Commission official told Kathimerini that the agenda for negotiations would be “crammed” at the beginning but that he expected talks to become easier once the issue of the fiscal gap is resolved.
The official said he was optimistic a deal could be reached before January’s Eurogroup summit.
Bundesbank chief says no to Greek haircut, yes to reforms
Bundesbank chairman and European Central Bank board member Jens Weidmann ruled out another haircut to Greece’s state debt, urging Athens instead to press on with reforms to their completion.
In an interview with German newspaper Bild on Saturday, Weidmann said that “a debt haircut would not constitute a solution to the basic problems of the country,” adding that Greece must continue on the difficult path of reforms to its end.
“The country must correct the competitiveness problems it has brought upon itself. It must become more productive and streamline its budget further. More help from abroad would only buy it some time, but it cannot be a substitute for the necessary reforms in the country itself,” he stated.
He went on to say that the financial crisis in the eurozone will be fanned again if member states abandon the reform course.
“The euro is in the restoration phase. At that stage you need strength and resolve, otherwise there is the risk of falling back. At the moment markets have quietened down, but this could be some misleading safety. The crisis could be fanned again like a fire,” warned Weidmann.
**** Sources: Deutsche Welle; Kathimerini