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03/12/2016

Ratification hurdles could sink new Greek bailout

Elections

Ratification hurdles could sink new Greek bailout

Hardliner Panagiotis Lafazanis could lead a rebellion against the bailout

[Wikimedia]

Even if European governments agree to a comprehensive package for Greece at the extraordinary EU summit on Sunday (12 July), the bailout still has to be ratified by the German Bundestag as well as by the parliaments of Finland, Slovenia and Estonia.

The Greek parliament will vote on the measures today.

A senior lawmaker from Chancellor Angela Merkel’s Bavarian allies said he saw no majority in the conservative parliamentary group for another bailout package for Greece, suggesting German opinion against Athens’s future in the euro is hardening.

The comments by Peter Ramsauer, deputy leader of Bavaria’s Christian Social Union, were the latest sign that Germany conservatives were losing patience with Greece after the landslide rejection of European bailout terms in a Greek referendum. The CSU is a member of Germany’s governing coalition.

Greece had a midnight deadline yesterday (9 July) to submit a reform plan meant to convince European partners to give it another loan to save it from an imminent economic meltdown and possible exit from the eurozone.

>> Read: Greece submits reform plan two hours before midnight deadline

“I currently see no majority in the conservative parliamentary group for further aid to Greece worth billions of euros,” Ramsauer said in an interview with the Passauer Neue Presse daily, published on Friday.

Even if Greek Prime Minister Alexis Tsipras was to improve his reform proposals, they would lack credibility, according to Ramsauer, a former transport minister under Merkel and chairman of the economic affairs committee in the German parliament.

“Where there is no will, there is no way,” Ramsauer said, alluding to Greece’s leftist government, adding that he did not expect a deal in the last-ditch Greek debt talks at the weekend.

“An exit from the eurozone, a Grexit, would be the right way,” he said, adding that any extension of negotiations with Athens would amount only to delaying a bankruptcy.

Vice Chancellor Sigmar Gabriel, leader of the Social Democrats (SPD), junior partner in Merkel’s ruling coalition, has said Greece needs to improve on its previous proposals.

The ratification of the eventual Greek bailout could face even bigger difficulty in Finland’s parliament.

Finnish Foreign minister Timo Soini, head of the populist Finns party, has called the Greek drama “simultaneously a parody, a comedy and a tragedy . . . that will continue as long as the milkmaid has a cash cow to milk”.

Today, the Greek parliament will be asked to authorise Tsipras and other senior officials to hold new talks on the basis of this latest bailout offer.

But Tsipras could face a challenge from hardliners in his Syriza party who reject any austerity no matter the cost.

Having won a thumping referendum majority to reject the austerity terms of a previous bailout plan, fired his turbulent finance minister and secured support from opposition party leaders, Tsipras is in a stronger position to impose tough measures and face down resistance at home.

But in a sign of the some of the challenges he will face, the leader of the far-left wing of his Syriza party came out to denounce any imposition of harsh measures on Greeks.

“We don’t want add to the past two failed bailouts a third bailout of tough austerity which will not give any prospects for the country,” Energy Minister Panagiotis Lafazanis said.