Greece is running out of time to implement reforms as patience among eurozone finance ministers is fraying, according to Edward Scicluna.
The Finance Minister was speaking yesterday after attending a Eurogroup meeting during which no tangible progress was reported on Greek reforms.
“The situation is so absurd that Greek government officials are meeting representatives of the institutions in hotel lobbies and not at the ministries, simply to make a point while providing very little information,” Prof. Scicluna said.
‘Institutions’ refers to the European Commission, European Central Bank and International Monetary Fund – previously known as the Troika. 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.
Prof. Scicluna said progress since February, when a last-minute agreement gave Greece breathing space to present a new reform programme, was very slow.
“Nobody expected to have a solution in today’s [yesterday’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 after what he described as “a very civil” meeting.
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.”
He warned that time was running out as Greece faced serious liquidity problems.
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.
But as Greece dilly-dallies on reforms the country risks 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.
kurt.sansone@timesofmalta.com