Europe is “in-between the sea” in resolving Greece crisis and cannot turn back; otherwise it will have to resolve the fate of hundreds billions euro that have been invested for overcoming the crisis.
On July 13 the EU and Greece have reached compromise after 17-hour negotiations: EU is providing financial aid to Greece further on, and in return Greece and its lenders agreed on reforms required for the start of the official negotiations about the third program of aid to the country, announced Donald Tusk, the President of the EU Council.
Greece PM Alexis Tsipras has called the agreement with the EU lenders beneficial, since it permits to reach restructuring the debts of more than 240 billion euro that were formed after the Greece budget was saved from default and medium-term funding in 2010.
What price can the EU pay for the preservation of Greece in the Eurozone? Ulad Vialichka, the head of the International Consortium “EuroBelarus”, answers the questions of the “EuroBelarus” Information Service.
- The EU provides Greece with financial aid; in return, Athens performs serious three-year reforms: pension system, labor market, and privatization. Did the EU untie the Greece knot?
- Greece knot isn’t untied yet, but it has already got chances for solution with the current government. Realization of reforms causes numerous questions, because obligations for the loans that have been issued earlier are given by different governments that are more oriented at the dialog with the EU and with the countries-lenders. Now we observe the dialog of the skeptically oriented Greece government with lenders in deeply nervous and neglected situation, when the moment of paying the bills can be no longer delayed.
The inevitable happened: each side firmly insisted on their own terms, but both the partners realize that without reaching common agreements the situation will turn to be much worse. That is why after 17-hour negotiations compromise could finally be reached.
- It seems that Greece remains in the Eurozone, but at what price?
- When the ship has been sailing for a long time and the opposite shore is already seen at the horizon one cannot think of coming back. For now Europe is in the situation of a ship in the open sea – it cannot turn back; otherwise it will have to resolve the fate of hundreds billions euro that have been invested for overcoming the Greece crisis. The only way-out for united Europe is to reach the far shore at any cost. In my opinion, this is the right political logic – even in this case price for Europe will be lower than the complete refusal to realize the project of saving the Greece economy and launching the process of its withdrawal from the Eurozone.
- Do the reached agreements guarantee return of Greece to the zone of stability? What the EU is hoping for?
- There are no guarantees; it is rather a political statement that is aimed at emphasizing certain intentions. Return to the zone of stability depends on huge number of factors that cannot be forecasted with certainty today. Time will show the viability of such hopes.
For now it is clear that the latest round of tough negotiation has passed. Both the parties were looking for the border that the other side won’t overstep, and it feels like they found it. However, Greece political history of the latest decades is very changeable, so we cannot say that the crisis is over with 100% certainty.
- Few days ago experts compared Greece with Belarus that is also repeating Greece way with great strides. By and large, Belarus, likewise Greece, is facing a choice today: either reforms or bankruptcy. Will the Greece experience teach Belarus something?
- I cannot agree with the thesis that we are facing the same choice that Greece is facing: reforms or bankruptcy. However, we can trace numerous Greece notes in the Belarusan situation. For example, getting used to the constant new loans, which will be paid off by the future generations.
Greece experience is only partially relevant to the Belarusan situation, though the Russian factor is present even in Greece. Our geopolitical and economical situation, culture and labor discipline differ from those in Greece. We need to draw conclusions from the Greece story; and whether the conclusions we will make will help us avoid the debtor’s prison depends on many aspects, including braveness and ability of Belarusan authorities to perform opportune and unpopular reforms. For now we see no such boldness.