Wieser stands by 200bln€ damages estimate from Greece’s 2015 negotiations; Varoufakis, govt reactions

5 March 2018
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Former Euro Working Group (EWG) president Thomas Wieser over the weekend continued to insist on his 200-billion-euro estimate of damages incurred by Greece from the shambolic first-half negotiations in 2015 between the Tsipras government and institutional creditors, this time detailing his calculation before a mostly Greek audience.

Wieser’s eyebrow-raising statements since he left the EWG post last month have been grating for the poll-trailing leftist-rightist coalition government and “music to the ears” of the country’s opposition, especially poll-leading center-right New Democracy (ND) party.

Speaking at the third Delphi economic forum, the Austrian economist said his calculation of damages for the Greek economy in the run-up to a third bailout memorandum – January-July 2015 – is “safe and conservative”.

Wieser told an audience in Delphi, including numerous local and foreign reporters, that if an economy implodes by 20 percent in one year, and subsequently returns to its previous level the next year, then a 20-percent GDP loss is incurred. In broad terms, however, he added that when calculating the loss of income and loss of employment in subsequent years from the specific six-month period, then damages equalling an annual year of GDP arises.

The controversial “architect” of the Tsipras government’s negotiations with creditors at the time, former finance minister Yanis Varoufakis, was quick to respond, via Twitter.

“The efforts of the domestic and foreign troika to vindicate us are touching; only deliberately can they utter such grand nonsense. I have no words by which to thank them.”

In a bid to downplay the former EWG chief’s repeated assertion of 200 billion euros in damages from the first six months of the Tsipras government’s rein, government spokesman Dimitris Tzanakopoulos merely noted that “…We could say that the government’s negotiations (in first-half 2015) cost twice or thrice or seven times Greece’s GDP. Anyone can speak his mind, besides, it costs nothing…”

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