For more than six years, the state of public finances in Greece has dominated the economic debate in the European Union (EU) — much to the detriment of other pressing issues. Indeed, while Athens has received bailouts on three separate occasions from the EU, the European Central Bank (ECB) and the International Monetary Fund (IMF), it has likely done more to convince Eurosceptic Britons that the EU model as a whole and its poorer nation states in particular cannot handle their public finances; that Brussels is a bottomless pit of debt and poor governance; and that the United Kingdom is better off, both with the pound and outside the 28-member bloc entirely.
At a summit in Brussels last week, and after the Athens government had days before passed a series of austerity measures and tax increases, the so-called troika of the EU, ECB and IMF agreed on terms to release the latest tranche of 10.3 billion euros (Dh42.27 billion) to the Greek coffers. Considering past summits have been stormy affairs, where Athens’ commitment to austerity, reforming its public programmes, selling off its state-owned assets and cutting back its social spending and pensions had been questioned by eureaucrats, the 11-hour meeting in Brussels went relatively smoothly. Key to reaching the deal so quickly was a hesitation by the IMF to insist on its previously stated aim of having the bulk of Greece’s debt frozen, with Athens being allowed to make a modest 1 per cent payment annually until 2050 or having the entire debt rolled over to 2080.
There was little political desire in the room to drag out the negotiations. Brussels and the rest of the bloc are on their best behaviour until after Britons vote on their future ‘in’ or ‘out’ of the EU. After that, it’s bickering as usual.
