Greek PM Says EU ‘sleepwalking toward cliff’

28 August 2016
187 Views

The government is in a race against time to convince a demoralized electorate that its policies will bear fruit soon and that the Greek economy is on its way to recovery, as its grace period is running out with further tax hikes and spending cuts looming.

According to senior aides, the government believes that its communication strategy could extend this grace period but is well aware, nonetheless, that it realistically has until the end of year to come up with tangible results that will justify this narrative or else face a tense start to the new year.

The sense of urgency was reflected in a meeting earlier last week between Prime Minister Alexis Tsipras and government and party members, where there was wide consensus that the strategy of blaming the government’s predecessors for the country’s ills is beginning to wear thin, as the leftist-led administration has already completed 18 months in power.

To this end, Tsipras aims to use his keynote speech at the Thessaloniki International Fair in September to hammer home the message that Greece will soon be on the path of growth and that any benefits will be fairly distributed among those hit hardest by the crisis.

Kickstarting growth is, however, inextricably linked to the coalition’s other major challenge: to conclude the second bailout review – with all the negative repercussion on labor laws that this entails – and to secure a restructuring of the country’s debt.

The bottom line is for the government to come away from the negotiations with creditors with a clear message to international markets, by the end of the year, that Greece’s debt is sustainable in the long term. This, aides believe, could give the government – which has lagged behind conservatives in recent polls – a shot in the arm and valuable breathing space to prepare its return trial to international markets, the latest by the summer of 2017, which Tsipras hopes will mark the end of Greece’s dependence on bailouts.

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