The Greek PM proclaims the “end of austerity” but others say the deal to extend the country’s EU funding is only temporary.
Alexis Tsipras has said Greece “won a battle, not the war” by cutting a financial deal with Europe after days of tense negotiations, reports Sky News. The Greek prime minister said his country was now leaving its period of austerity and had dispensed with the “troika” of European Union, International Monetary Fund and European Central Bank inspectors who are hated by many Greeks. In a televised statement, he told Greeks: “Yesterday we took a decisive step, leaving austerity, the bailouts and the troika behind.
“We won a battle, not the war. “The difficulties, the real difficulties…are ahead of us.” Without a deal in Brussels, Greece faced panic when banks opened on Tuesday after the long weekend but the country has now secured a four-month extension to its EU funding. This means it avoids bankruptcy and an exit from the euro but it has to come up with promises of economic reforms by Monday and some, such as the Irish finance minister Michael Noonan, say the deal is only a temporary reprieve. Mr Noonan, himself from a country which endured years of austerity under its own bailout programme, says the eurozone had given nothing to the Greeks, despite the tough talk from Mr Tsipras.
He said: “Their political problem is that this a reversal of their election position. “They’re now compromising and compromising quite significantly. “The biggest threat to Greece was that their banking system would go belly up next Wednesday.” Mr Noonan said Greece now faces another bailout on top of the two totalling €240bn that it has had since 2010, adding: “Once you get them into the safe space for the next four months, there’ll be another set of discussions which will effectively involve the negotiation of a third programme for Greece.”
Mr Tsipras and his Syriza party won power in Greece on the back of promises to end the country’s EU and IMF bailout programme and cooperation with the “troika” that monitored their compliance with the bailout deal’s conditions. While winning support at home from Greeks who see his actions as getting tough instead of begging to Brussels and taking orders from Berlin, Mr Tsipras is still under pressure to move fast. About a billion euros flooded out of Greek bank accounts on Friday, due to savers’ fears that the talks would fail and Athens might put measures in place to stop withdrawals in preparation to bring in its own currency. This came after about €20bn withdrawn by Greeks since December, when the prospect of a Syriza electoral victory became clear.