Eurozone finance ministers are losing patience with Greece as it dilly dallies on reforms after no tangible progress was reported at Friday’s eurogroup meeting, according to Edward Scicluna.
He said the European Commission, the European Central Bank and the International Monetary Fund – referred to as the institutions instead of Troika – had little to report as technical talks with Greek government officials were being hampered.
“Nobody expected to have a solution in today’s meeting but everyone was surprised at the time wasted since February by the Greek government to reach an agreement with the institutions on the way forward,” he told Times of Malta.
Greece wants to reverse previous reforms that imposed savage cuts on public spending that sent many into poverty.
Prof. Scicluna said the institutions would consider targeted reversals of previous reforms to alleviate the problems for certain categories in society but not blanket provisions such as across the board increases in pensions and the minimum wage.
It was frustrating for the institutions because they were not being given the full picture by the Greek government, Prof. Scicluna added. “Instead the institutions are getting the picture in drips and it is taking too long.”
The new Greek government led by the far left Syriza Party in January insisted it did not recognise the Troika as it rejected the austerity programme imposed when Greece was bailed out by fellow eurozone countries. It was elected on a platform to end austerity.
A last minute agreement in February gave Greece breathing space to present a new reform programme, which had to be agreed with the Troika – renamed institutions upon Greek insistence.
The next meeting of finance ministers is expected in May and reaching an agreement will be critical since Greece has around €1 billion of repayments due with the IMF. The first payment of €750 million is due on May 12 as Greece runs the risk of running out of money and crashing out of the euro.
“The situation is deteriorating and while everybody wants Greece to remain within the eurozone there is a communications breakdown with the institutions speaking one language and the Greeks another,” Prof. Scicluna said.
He insisted a Grexit – the term used to describe a Greek exit from the eurozone – had enormous implications and nobody wanted to head down that road.
However, Prof. Scicluna warned that if Greece did not change its attitude towards the technical teams from the institutions within the next two weeks, it would be very unlikely deadlines will be met.
Jeroen Dijsselbloem, the Dutch Finance Minister who chaired the meeting in the Latvian capital, slammed the door on Greek Finance Minister YaniVaroufakis' proposal for early cash after partial reforms.
"A comprehensive and detailed list of reforms is needed," Mr Dijsselbloem told a news conference following the meeting. "A comprehensive deal is necessary before any disbursement can take place ... We are all aware that time is running out."
He also said a remaining €7.2 billion in frozen bailout funds would no longer be available after June, and Greece's creditors would not talk about longer term funding and debt relief until Athens concluded a full interim agreement.
Greek Prime Minister Alexis Tsipras said after meeting German Chancellor Angela Merkel in Brussels yesterday he hoped for an agreement by the end of this month and Merkel today reiterated her call for a deal soon.
European Central Bank President Mario Draghi said the ECB would go on allowing emergency lending to Greek banks as long as they were assessed as solvent. But he cautioned that soaring Greek government bond yields were diminishing the value of the collateral that the banks present to get funds.