http://www.guardian.co.uk/business/2012/may/09/eurozone-crisis-greek-euro-exit-fears
Shrewd Tsipras builds bridges as Venizelos refuses Mandate, talks behind scenes to Troika.
http://www.athensnews.gr/portal/8/55398
Breaking news in from Greece where our correspondent Helena Smith, says mandarins in the EU should be braced for yet more tough language from Alexis Tsipras by lunchtime!
Helena writes:
Helena writes:
http://hat4uk.wordpress.com/2012/05/09/euroblown-troika-cancels-athens-visit-as-greece-heads-for-second-election/Sources at Syriza have confirmed that the leftist leader is about to send a letter to the European Commission, the EU's executive branch and the European Central Bank, explaining why Greece can no longer commit to the the hard-hitting austerity program it signed up to in return for its second aid package.The missive, which is expected to land on the desks of European commission president José Manuel Barroso, EU president Herman Van Rompuy and ECB president Mario Draghi by lunchtime, repeats the five points Tsipras made when he received a mandate to form a government on Tuesday.Aides close to the leader said the letter made clear, in no uncertain terms, that the controversial loan agreement outlining the terms on which Greece has and will receive rescue funds from both the EU and IMF was "null and void." "It has been delegitimized by the people," said one aide - referring to Sunday's earthquake election where anti-austerity parties opposing the conditions, now widely referred to as the "anti-memorandum" front, won over 65 % of the popular vote. "Greece has been turned into a prison and we have to somehow get out of it."But Tsipras is also believed to have reconfirmed Greece's desire to remain in the single currency. Syriza officials, once again this morning, were at pains to stress that the party's objective was not to leave the euro zone - or "back peddle on our European orientation."
"What Syriza is against is the memorandum which is cruel and unfair and has robbed Greeks of their democratic and social rights," Nikos Filis, editor of the Avriani, the paper closest to the party told me. "Greece is proving to be a laboratory. What has happened here will happen elsewhere in Europe as we have seen in France. The emphasis has to be on growth and development if the single currency is to be saved."
And here's a reminder of Tsipras's five-point plan to save Greece:• Cancelling the bailout terms, particularly cuts to wages and pensions
• Scrapping laws that abolish workers rights, particularly a law abolishing collective labour agreements
• Promoting changes to deepen democracy and social justice
• Investigating Greece's banking system
• Setting up an international committee to find out the causes of Greece's public deficit and putting on hold all debt servicing
Analysts at Credit Suisse are concerned that the political crisis in Greece could spark a new run on its banks.
In a new research note, Credit Suisse said current events are likely to accelerate the steady withdrawal of funds from Greek banks. Bank deposits are already 30% below their peak - as some people have shifted money overseas, and others have used up their savings to keep afloat.This chart shows how deposit levels in Greek banks has fallen every quarter since the end of 2009.
Deposit flight has tended to accelerate in periods of particular uncertainty. So a prolonged period of political volatility, in which Greece's membership of the euro may become more openly debated, is likely to lead to renewed deposit flight.
That would further undermine the stability of the banks and economic activity. Given that the political volatility in Q4 last year led to a 6% drop in deposits, over a month of political uncertainty could push deposit flight to unmanageable rates.and.....
EUROBLOWN: Troika cancels Athens visit as Greece heads for second election.
Shrewd Tsipras builds bridges as Venizelos refuses Mandate, talks behind scenes to Troika.
In a first for Greek politics, Evangelo Venizelos (left) the leader of Greece’s PASOK Party refused to accept the President’s mandate before he’d been offered it. This breaks the record set by Antonis Samaras last Monday, in giving up on the task after 210 minutes.
What’s going on here is shadow boxing ready for what is almost certainly going to be Round Two – another election. This growing view was given further weight today when The Sueddeutsche Zeitung reported that the EU/ECB/IMF troika has cancelled its Athens visit planned for mid-May. No new appointments have been made, and the Brussels line – for once, probably fairly straight – is that they would have to await political developments in Greece.
In this context, Alexis Tsipras is being more shrewd than most commentators realise. He has spent a lot of time meeting with Party leaders who have no seats in parliament – Louka Katseli of Social Pact, as well as the Ecogreens, who said they had some reservations about Syriza’s position and required clarification about its stance towards the memorandum. Tsipras has also scheduled a meeting with the Anticapitalist Left (Antarsya).
Sources explain that the Syriza leader’s plan is to go into Election II with a united ‘Green Left’ that encourages protest voters to go along with the critical mass – especially those who didn’t vote from a sense of hopelessness the first time around.
This morning I spoke with The Slog’s resident Brussels mole.
“Tsipras has been impressive thus far,” he observed. “And that on top of Sunday’s result has scared some of the more aware people here. There’s a real fear of market meltdown. But I was told yesterday that the Troika is certain there will be a second election. My guess is that Venizelos is still their main cypher. But I’ve no idea how he expects to get the initiative back.”
My Brussels contact has no knowledge (or even hint) of an ‘action’ being prepared by Berlin-sur-Brussels to install a technocrat interim government, although several Slog sources in Athens fully expect this, and think Venizelos to be actively playing for it.
“He is a traitor,” says one source on the Left, “And Samaras the same. They cannot win by the ballot box, so they hope to win by Brussels pressure.”
However, European Parliament President Martin Schulz yesterday took a soft line, saying that he intends to visit Athens for contacts with politicians, including Syriza head Alexis Tsipras. Speaking in Berlin, he said that Greece needs a growth policy and an employment policy. Although rejecting any possibility of renegotiation of the Brussels Accord terms, he was at pains to distance himself from Berlin-style scorched earth.
“If the fiscal pact is accompanied by growth incentives, it is possible that a majority can be achieved in the Greek parliament,” Schulz said, adding that “following the complicated outcome of the elections in Athens, it is important now for us to speak with the Greeks.” He stressed that “the aim is not for us to harm Greece and this is why the rest of the Parliamentary forces must also be certain of this.”
Of course not, why on earth would you do that Martin? I mean, if Greece has an epi and walks out, you’re screwed, right?
It should be Interesting Times on the European markets today. If anything of real significance occurs, the chances are you’ll be reading it here first.
and....http://www.athensnews.gr/portal/8/55398
1.30pm Another government scenario has been shot down: earlier, the Democratic Left party leader Fotis Kouvelis said that the speculations that he could lead a coalition of New Democracy, Pasok and his party "is a scenario without any basis". He added he believed that the country was heading towards fresh elections.
12.30pm Alexis Tsipras is currently holding talks with the social partners, to discuss his political proposals. However, two unions have declined the invitation. The private-sector General Confederation of Greek Workers (GSEE), public-sector Adedy and the Teachers' Federation of Greece (DOE), which represents primary school teachers,said they had no constitutional role in the formation of the government.
12.10pm The leader of the Independent Greeks, the country's fourth largest party, has just finished addressing a meeting of his new crop of MPs in parliament. Panos Kammenos told his party had pulled off a "miracle" by winning 33 seats in Sunday's election. He said that 68 percent of the electorate had voted against the memorandum in parliament. "We are the anti-memorandum front. The fight to liberate the country is above all else," he said, adding that he will refuse to meet the New Democracy and Pasok leaders, who had signed themselves over to "foreign bankers". "Everyone that hurt this country will pay the price," he said, to the applause of his MPs. Warning that the country is ignoring national issues, he said this was the fault of the "new world order".
11.25am Here's Alexis Tsipras' schedule for the day:
- 5pm: meeting with Panos Kammenos of Independent Greeks
- 6pm: meeting with Evangelos Venizelos of Pasok
- 7pm: meeting with Antonis Samaras of New Democracy
He will conclude the day's business with a meeting of Syriza's newly elected MPs.
11.20am The renowned composer Mikis Theodorakis last night expressed his support for Syriza and the efforts of its leader, Alexis Tsipras, "to form a government that will terminate the memorandum and will seek to recover our country's national sovereignty". He was speaking after a meeting with Tsipras, Manolis Glezos MP and constitutional law expert Yiorgos Kassimatis. Theodorakis called on all "patriots" and "creative Greeks" to assist in bringing Greece to self-sufficiency, progress and rebirth.
10.45am European Parliament President Martin Schulz said yesterday that he intends to visit Athens for contacts with politicians, including Syriza head Alexis Tsipras. Speaking in Berlin, he said that Greece needs a growth policy and an employment policy, but rejected however every possibility of the renegotiating of the terms of the fiscal stabilisation. "If the fiscal pact is accompanied by growth incentives, it is possible that a majority can also be achieved in the Greek parliament," Schulz said, adding that "following the complicated outcome of the elections in Athens, it is important now for us to speak with the Greeks." He stressed that "the aim is not for us to harm Greece and this is why the rest of the Parliamentary forces must also be certain of this."
10.30am There is a lot of speculation as to why Alexis Tsipras is meeting with parties that are not represented in parliament. He's already met with Louka Katseli of Social Pact, who says she support's Syriza's position. He also sat down with the Ecogreens, who said they had some reservations about Syriza's position and required clarification about its stance towards the memorandum. Tsipras has also scheduled a meeting with the Anticapitalist Left (Antarsya).
Out of the outcomes of the meetings is that Tsipras could manage to add even more parties to Syriza, which already comprises 16 parties and groups. Syriza would stand to benefit from that extra support at the next election, if one is held.
10.10am The Sueddeutsche Zeitung is reporting today that the EU/ECB/IMF troika has cancelled its visit, planned for mid-May, to Athens. All travel plans have been cancelled and new appointments have not been made. The reason given in Brussels is that one would have to await "political developments" in Greece.
9.45am Here's a roundup of some reactions from European and German political leaders to Tuesday's developments in Athens:
- Martin Schulz, German MEP and president of the European Parliament: "The agreements must be respected. I don't think we can or should renegotiate."
- Gerda Hasselfeldt, a senior member of the Bavarian Christian Social Union (CSU), sister party to Chancellor Angela Merkel's Christian Democratic Union (CDU): "Our position is unchanged. Aid can only flow if the conditions are met."
- Joerg Asmussen, ECB executive board member: "Greece needs to be aware that there is no alternative to the agreed reform program if it wants to remain a member of the eurozone."
- European Commission President Jose Manuel Barroso: "What member states have to do is be consistent, implementing the policies that they have agreed ... The programme countries have no alternative, except disorderly default, except that I think it is not an alternative, than to pursue courageous fiscal consolidation measures, structural reforms for competitiveness, and of course, mostly also benefiting from European solidarity, some targeted investment – but investment that can bring growth.”
9.10am Here's a summary of what happened yesterday
- Radical Left Coalition (Syriza) leader Alexis Tsipras has said that Sunday's election result renders null and void the country's commitments under the bailout memorandum. Tsipras was speaking after receiving a mandate from the president to see if he can form a government.
- Tsipras said that he could only work with New Democracy's Antonis Samaras and Pasok's Evangelos Venizelos if they took back their written support for the memorandum - by writing a letter to Brussels informing them of this.
- The Syriza leader also outlined a five-point programme which he will present to party leaders over the next few days. The points are
- an end to pension and wage cuts
- an end to dismantling of labour rights
- electoral reform and an end to parliamentary immunity
- state oversight of the banks
- an audit of the national debt and a moratorium on all repayments until this is completed
- Antonis Samaras has lashed out at Tsipras, calling on him to "come to his senses" before he risks forcing the country out of the euro. "Mr Tsipras asked me to put my signature to the destruction of Greece. I will not do this," Samaras said. "The country cannot afford to play with fire."
- In his reaction, Evangelos Venizelos, the Pasok leader, said the country needed "the greatest calm, responsibility, good faith and generosity". He reiterated his call for a coalition government of New Democracy, Pasok, Syriza and Democratic Left.
What's on the agenda for today?- More leaders' meetings: Alexis Tsipras will meet with the New Democracy and Pasok leaders to discuss his proposals for a coalition government. He already met a number of leaders yesterday. However, the Communist Party chief, Aleka Papariga, rejected Tsipras' invitation to meet.
and.....
Revenues fall victim to elections
The election period did nothing to help state receipts as the tax collection and monitoring mechanism traditionally relaxes ahead of polls, and did so again this year despite the crisis. Value-added tax revenues declined by 13.5 percent year-on-year, while customs takings fell by 12 percent. The drop in VAT revenues points to the considerable cash flow problems that enterprises are facing, but was aggravated by the election period. Total revenues before tax returns were 13.4 percent smaller than in April 2011. In the first four months of the year, the revenue decline amounted to just 0.5 percent, but this was thanks to the extraordinary property tax tagged onto electricity bills that was imposed this winter for the first time. Property taxes posted growth of 1,793 percent compared to the same four months of 2011.
and from the telgraph liveblog , note decline for GDP and this before we see further deterioration this year to revenues.....
10.20 Greece will exit the euro by the end of the year, according to economists at Lombard Street Research. Jamie Dannhauser, an economist at Lombard, said:
 Political stalemate (or worse) could persist for some time. The Troika has threatened to block disbursement of further funds to Greece unless the Parliament passes a package of additional reforms and fiscal retrenchment. But it is hard to see how a government could be in place to push through such policies in time. Ms. Merkel has made her position clear – austerity measures are “not negotiable” for the Germans. [...] At the end of the day, the Greeks may decide that further austerity is a price worth paying for EMU membership. Alternatively, the Germans may swallow their pride and allow the Greeks to renegotiate the terms of their financial aid package. Most likely, however, is the third option – a Greek exit from the €. It is quickly becoming apparent that for Ms. Merkel this is the least damaging route to tread.
and....
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