Greece and the Eurogroup Could not Reach an Agreement

• 02.17.2015, 22:56
•  Europe,  "Insight" Analytical Center ,  World

- The negotiations between the Eurogroup and Greece on the financial crisis management ended on Monday. The sides did not reach an agreement. In your opinion, what will be the outcome of this situation as?

- First of all, let me note that the situation around the Greece economic crisis, the disagreements between Brussels and Athens over the ways to overcome it, is still continuing. Simply until now Athens did not have the very government that would go against Brussels. In the early elections the newly-elected authorities led by the PM Alexis Tsipras, received people's votes by building their campaign on freeing Greeks from the bailout and the Troika (EU, ECB, IMF).  

Tsipras became the person, who put prerequisites to Brussels and even declared about his willingness to turn for help from the US, Russia and China. The country’s debt is 320 billion euros, which is twice of its budget. In this case to find any possible way out of this situation is difficult both for Greece and the Eurozone.

It is said everything is being done today to reach a consensus. However, in reality each side tries to pursue its own visions and beliefs. After several attempts to reach a consensus failed, Eurogroup presented a new plan developed by the Ministry of Finance in a special session on Monday. One of the main points of this new plan was the "bridge agreement", which supposes that in the period from February to August Greece will be provided with interim relief funds. According to the latter loans with less percent interest are to be provided. In this period Greece intends to start an economic reconstruction plan. The Greek suggest cancelling the financial program which ends on February 28, instead of extending it and set an interim term till the end of August. During this period new platforms will be developed for economic reconstruction. Greeks promise to have the new terms of cooperation agreed with the creditors by September 1.  

This meeting of the Eurogroup could be considered crucial, as both sides declared that they would proceed with the negotiations if an agreement was reached. Nevertheless, the sides did not manage to reach an agreement: the EU said that it is ready to proceed with the negotiations in case the existing bailout program is extended for six more months. However, Athens is not satisfied with the conditions of the present program.

The following developments of the events can lead to various consequences such as Greece asking for a help from third countries or leaving the Eurozone. Although the latter does not have any precedent, and it may have disastrous consequences for the Eurozone, the German Chancellor Angela Merkel is considering the possibility for Greece to leave the Eurozone and its possible consequences. Nevertheless, it should be stressed that in this case both sides will loss.

Taking into account the above-mentioned, it is important to stress once more, that no matter what steps the government undertakes in its negotiations with Brussels, the Greeks consider that they are presented by these authorities and thus support their decisions and initiatives.