AFP
Athens
Greece’s prime minister vowed yesterday not to back down in his “battle” with the country’s creditors, in line with his election promise to abandon austerity and avoid a third bailout.
“The battle will continue,” Prime Minister Alexis Tsipras told the central committee of his hard-left Syriza party. “Anybody thinking that we are going to go away will be disappointed.”
Tsipras said that in the talks that landed Greece a four-month extension to its €240bn ($270bn) bailout Tuesday, the pressure from other European countries “had the character of blackmail”.
“Conservative forces (in Europe) tried to set a trap for us, to drive us into budgetary asphyxia,” the 40-year-old said. “We will not retreat from the difficulties or from our own principles.”
Syriza swept to power in January on a promise to ease the hardship caused by past government spending cuts imposed in return for the eurozone country’s two bailouts in 2010 and 2012.
Tsipras reiterated Friday that once the current bailout expires on June 30 there would be no “third memorandum” as the previous agreements tying aid to spending cuts are known.
“Memorandums are finished,” he said.
Is it unclear however whether Tsipras can avoid another rescue package.
His self-declared “government of social salvation” faces a major challenge in keeping both voters and Greece’s international creditors happy by providing relief for the poor while also keeping government spending in check.
Thursday saw the first protests in Athens since the bailout extension, with several hundred anti-capitalists and anarchists taking to the streets, some smashing shop windows and setting fire to rubbish bins.
Greece must also repay billions of euros in debt in the coming months.
Tsipras has said he wants to renegotiate the country’s €320bn debt pile, despite fierce opposition, particularly in Germany, to any new debt “haircut”.
Meanwhile, Greece’s nascent recovery from six straight years of recession also looks in trouble, with official data on Friday showing a contraction of 0.4% in the fourth quarter of 2014. Initial estimates had forecast a 0.2% drop in gross domestic product.
After winning four months of breathing space from its creditors, the government now has until the end of April to provide them with more details of its reform programme in order to receive the final bailout tranche. A list of reforms submitted by Athens last week, which focused on tackling tax evasion and excessive bureaucracy, was described by German Chancellor Angela Merkel as just a “starting point”.
Germany’s parliament nonetheless overwhelmingly approved the bailout extension Friday, despite a minor rebellion by members of Merkel’s party, surveys suggesting German voter unease and the country’s Bild daily saying “greedy” Greece should get no more money.
Yesterday, Yanis Varoufakis, Greece’s maverick new finance minister, promised “no pity” in tackling tax evasion and said that the government might impose a one-off levy on the rich to help fill government coffers.
“What interests us is those who have money but who have never paid (tax). They are our target and we will show no pity,” Varoufakis told the TV channel Skai. Varoufakis assured such a levy would “only be for those who can pay.”
We are not going to take money off people who are suffering,” he said.
Tsipras said Friday the government would table legislation early next week aimed at alleviating poverty and putting the country of 11mn on a more equitable road to recovery.
His plans include free electricity for 300,000 poor families, housing for 30,000 people and measures to protect people at risk of losing their homes.