Prime Minister Samaras' Merkel Requests

A few days before the troika returns to Athens, the prime minister – according to information obtained by TheTOC.gr – will ask Ms Merkel accept that the lenders’ representatives do not insist on unreasonable demands regarding mass layoffs and detrimental changes to social security and labor laws.

Essentially the coalition government - following the agreement reached between the Prime Minister and Deputy Prime and Foreign Minister, Evangelos Venizelos – is seeking to prolong its political life and transfer all contentious decisions until after the election of a new President of the Republic. (Parliament is due to elect a new head of state in March. If the coalition government is unable to obtain a majority of 180 MPs for the election of a new President then early general elections will be triggered).

Both men consider that there is no alternative – if the lenders do not wish to see political change in Greece and SYRIZA to come to power – other than that the government be supported in the following ways:

• for all difficult reforms to be postponed for at least six months, i.e. until the end of March following the election of a new president (assuming that occurs and early elections are not triggered),
• for a final solution to be outlined by the end of the year regarding the sustainability of Greece’s debt.

The government will, in the coming days, attempt to achieve a rationalization of the negotiations in order to avoid a clash with the troika. Mr Samaras will press for this during his meeting with Ms Merkel, as will Evangelos Venizelos who will meet with the vice chancellor of Germany and the German finance minister who will visit Athens.

The Greek side, according to the strategy agreed on by Samaras and Venizelos, are seeking to take a political approach to the negotiations and, given the political situation in the country and SYRIZA’s momentum, do not intend to bend to the troika’s desires.

As part of the prime minister’s attempt to deflate Alexis Tsipras – which will include multiple political attacks in the coming weeks – the PM’s circle is expecting a declaration of political support by Ms Merkel for the coalition government and recognition of its efforts.

According to sources, Antonis Samaras will attempt to obtain assurances from the chancellor that the coalition government will not come under additional pressure. He will make clear the political situation in the country and the potential for the radical left to come to power which the chancellor sees as undesirable.

“It would clearly be a catastrophe for the country to go back to 2009. But without courageous assistance – here and now – from the country’s partners, it cannot move forward,” say high-ranking government sources.

For the German side, the problem of Greece has not been solved but they consider that the coalition government is on the right track, “The Samaras government is travelling a very difficult road which, however, is bringing results,” they say. But while they recognize the progress on fiscal issues, they consider that the government is flagging on reforms.

The Greek side expects that the chancellor, who will not stray from her insistence for reforms and fiscal discipline, will provide a message of praise for Greece’s efforts, as well as a declaration of support for the coalition government.

The prime minister will discuss all that has happened in recent weeks with the chancellor and they will examine how to improve growth and increase liquidity to businesses. With regards to the critical issue of the sustainability of the debt, Antonis Samaras will insist that an agreement can be achieved in a number of ways and will offer the example of the agreement achieved by Eurogroup in 2012.  The Greek government’s desire is that it happen soon and be realistic, obviously taking into account the particularities of all the lenders.

In any event Athens will seek an outline of the solution to the debt sustainability problem by Christmas in order to use it as a political weapon – first in the run up to the election of a new president and, failing that, in the battleground of a general election.