Gov’t scrambles for coherent positions ahead of Eurogroup

Finance Minister Euclid Tsakalotos on Monday reassured Greece’s creditors that he will attend Thursday’s Eurogroup meeting with “specific” positions on all pending issues though the most Athens can hope for is a decision to reboot stalled bailout negotiations.

European officials told Kathimerini that not enough progress has been made for foreign auditors to return to Athens. What is likely to be decided on Thursday is what the conditions for them to return will be.

The new deadline for Athens is the next Eurogroup – on February 20 – where it is hoped that a dragging bailout review might be finally concluded.

There was one positive development on Monday: The European Stability Mechanism decided to approve the implementation of short-term debt relief measures for Greece. Those were decided on last May but frozen in December in response to a unilateral decision by Prime Minister Alexis Tsipras to offer Greek pensioners a Christmas bonus and extend a value-added tax discount for Aegean islands.

The government does not appear well-prepared for the relaunch of talks. After suggesting over the weekend that creditors’ demands for further lowering the tax-free threshold were being negotiated, Economy Minister Dimitris Papadimitriou on Monday shifted stance, declaring that the government’s “fixed position” is to keep the threshold as it is.

Tsipras is keen to avoid further concessions to creditors as coalition MPs are already expressing discontent about the pressure being exerted by creditors, particularly the International Monetary Fund, for more austerity.

MPs want him and Tsakalotos to secure more substantial debt relief and lower primary surplus targets in exchange for any further measures.

So far Athens has rebuffed IMF demands for further pension cuts and reduction of the tax-free threshold but has indicated that it will agree to extending the implementation of an automatic fiscal mechanism, dubbed “the cutter,” beyond 2018.

Separately on Monday, the results of a parliamentary probe into financing of political parties and media organizations – championed by the government as a crackdown on corruption – failed to yield any evidence of criminal activities by politicians.