Over the next ten days the government must navigate a tricky path between the demands of the country’s lenders on the one hand and the tough uncompromising stance of the hardliners of SYRIZA. How Alexis Tsipras handles these competing demands will determine the future of the negotiations and whether the PM succeeds in striking a ‘mutually beneficial' way out of Greece’s fiscal crisis.
The situation is balanced on a knife edge. However it appears that for Tsipras the feeling is maturing that if, in the end the negotiations result in a compromise agreement, he will need to send a tough message demanding discipline from his MPs. “I will not accept the agreement passing through parliament with ‘borrowed votes,” he told SYRIZA officials referring to potential votes from opposition parties. “If I bring an agreement to parliament, it will be honest and beneficial for the people. So I will not accept negative votes from MPs of SYRIZA and the [junior coalition partner] Independent Greeks.”
It is clear that in the mind of the prime minister, such an outcome could result in a ‘Gordian knot’ that would need to be resolved in the ballot box: ie a snap election which would result in a definitive ‘settling of scores’ with any who continue to oppose him.
During yesterday’s meeting of SYRIZA’s central committee, Alexis Tsipras scored a marginal victory when a relatively slim majority of party officials voted in favour of his proposal which laid out the government’s ‘red lines’ for a potential compromise agreement and which gave the government the green light to declare a freeze on debt payments in the event that the country’s liquidity problem is not resolved by the 5th of June when a payment to the IMF comes due.
The party’s MPs decided that in the event that the impasse in the negotiations remains after June 5th then the party will opt to pay pensions and wages over the IMF payment.
However the ‘internal opposition’ within SYRIZA – consisting of about 30% of the party’s MPs who belong to the ‘Left Platform’ in addition to other potential ‘renegades’ – made its strength felt when a counter proposal submitted by the bloc received 75 votes compared to the 95 votes of Tsipras’s proposal.
The counter proposal openly raised the prospect of the country voluntarily returning to the drachma in the event that the lenders insisted on demanding that the government abandon many of its pre-election promises. The fact that the proposal received a robust 75 votes sent a strong message to the centrists that the hardliners are not willing to accept a compromise that would be seen as a continuation of the memorandum and may torpedo such an agreement in parliament.
The leader of the Left Platform, Panayiotis Lafazanis who is also minister of Productive Reconstruction and Energy was critical of the government’s move to announce that the privatizations of the Piraeus Port Authority and regional airports were to go ahead, maintaining that a final decision had not been taken.
The outspoken parliamentary speaker Zoe Konstantopoulou for her part noted that there were alternative routes to a swift agreement with the lenders at all costs, and that stopping debt payments to the lenders while negotiations are still ongoing remained an option for the government.
Brussels Group negotiations continue
At the same time the negotiations between the technical teams of the Brussels Group are continuing with lenders pressing for the completion of the fifth assessment of the memorandum and for the adoption of tough fiscal measures including VAT hikes, maintenance of the ENFIA property tax and for additional labour and pension reforms which are anathema for SYRIZA.
Despite the optimism expressed by officials close to Alexis Tsipras that an agreement will be reached soon that will not contravene the red lines established by the government, tough messages continue to be issued by the lenders who are resisting a ‘political agreement’ sought by the Greek prime minister, instead insisting that the numbers must add up with the technical teams signing off on it. The behind-the-scenes alliance between the IMF and Germany and the fiscal pressure on Greece create an asphyxiating context for the Greek government in the negotiations.
The Prime Minister Alexis Tsipras will soon be called to take important decisions given that he has shouldered the burden of the negotiations and has open lines of communication with foreign leaders with the aim of bringing a speedy conclusion to the negotiations.
As he said to SYRIZA’s central committee, the country has already made a number of compromises, but even noting that is risky in the face of internal opposition which appears to be gaining strength in the party raising the flag of defending the government’s pre-election platform.
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