quinta-feira, 2 de julho de 2015

Tsipras has earned his punishment

European and international officials have required thick skins this year. In Anglo-Saxon countries, they are daily lampooned as economic illiterates who caused the Greek economic crisis and have asphyxiated the economy during the past five months of negotiations. Now they are harangued by Alexis Tsipras as “extremist conservative forces” who are supposedly “blackmailing” the Greek prime minister’s downtrodden people. Stop. Little could be further from the truth.

The cause of Greece’s misery was many years of homegrown economic mismanagement and fiscal profligacy masked with lies over its accounts. When the global crisis exposed its economic misdemeanours, it lost the ability to borrow from financial markets and sought support from the international community. This was granted, largely by its European partners, ensuring much less austerity in Greece than any plausible alternative. Sure, the motives of creditors were not purely altruistic, but the money was lent with the aim of helping the country secure a better present and future.

Greece has achieved much since receiving the bailout loans, reducing budget deficit from 15 per cent of national income in 2009 to 3 per cent in 2014. It has implemented many necessary economic reforms; and the programme began to work, with Greek output growth topping the eurozone league table in the third quarter 2014. This progress was made despite Greece persistently failing to implement fully the reforms to which it had agreed.

Deploying the kind of tactics that would shame student politicians, the Syriza government has thrown all this hard-won progress aside in an attempt to extract more money from other European countries. It initially asked to reverse spending cuts and tax increases, backtrack on economic reforms and receive a huge debt writedown. There was never any chance of the creditors funding a wishlist that contradicted the democratic wishes of all 18 other eurozone countries. The Syriza-induced stand-off has pushed the Greek economy back into recession.

Saying no to a blank cheque did not mean the creditors were simply unreasonable. From before the election, they have offered more money, more favourable terms and the prospect of debt relief if Athens keeps its side of the bargain.

Debt relief has become another unnecessary sticking point in the negotiations. On Thursday, Yanis Varoufakis, the Greek finance minister, said he would prefer to cut off his own arm than sign a new deal without debt restructuring.

Let us be absolutely clear about this. Greece has already benefited from massive debt restructuring. The face value of its debt might be 175 per cent of national income, but it faces a lighter interest payment burden than Italy, Spain and Portugal (and one barely heavier than Germany’s).

As Klaus Regling, head of the European Financial Stability Facility, said this week, Greece has already received by far the most generous lending conditions ever granted to bailout countries. The EFSF loans have an average maturity of 30 years, and for the vast majority of these loans Greece enjoys a grace period on interest and principal payments until 2023.

In another act of solidarity, creditors have made it perfectly clear that further debt relief will be on offer once Greece implements the lending conditions to which it says it agrees. This is a perfectly sensible attempt to reward good behaviour on the principle that you do not give treats to a misbehaving child.

None of this is good enough for Syriza. Mr Tsipras is calling on the Greek people to vote against the offers made by the creditors in Sunday’s referendum, hoping that the terms will magically improve.

His explicit threat is to bring everyone else in the eurozone down with him should creditors decline to meet his demands. They will refuse, and rightly so.

Greece’s default against the International Monetary Fund did not spook markets as Mr Tsipras must have hoped, but the capital controls he has been forced to impose have added an even greater burden on long-suffering Greek citizens. So it will continue.

The longer Syriza pulls fresh stunts, the more pain Greece will suffer — with the danger that Mr Tsipras will lead it out of both the eurozone and the EU. Contrary to the widespread belief that such a result would be a disaster for the euro, it would reinforce the message that membership confers rights and responsibilities, and that there are consequences for countries that abuse this delicate balance.

Alternatively, Mr Tsipras could sign up to reasonable lending terms that have been available since the start of the year and the prospect of further debt relief once conditions are met. Having lost so much trust among the creditors, this is now the more difficult path. Europe will not crow and make it impossible for him to take this route, but it will require Mr Tsipras and Syriza to show some leadership and to ditch the victim mentality.

Chris Giles

Fonte: FT