Galery

1

Again, it depends on the perspective from which we judge the events. In political terms, both the President of the European Commission and Commissioner for Economic Affairs Pierre Moscovici said that they recognise the sovereign choice of the Greek people and that they will talk with the new government, pointing out at the same time that, in Europe, there are rules that all must respect. I do not see how this can be put more clearly.

Regarding the position of Tsipras and Varoufakis, in my opinion it has become unclear and variable. On the one hand, they want to change the status quo but on the other they say, "we will change it while observing the rules." This is an internal contradiction because they rebel precisely against the rules, against the so-called "memorandum" and the Troika, which are their basic structures. They say, "We do not want the Troika because it humiliates Greece, suppressing our national sovereignty. We want to speak directly with the lenders." Well, there will be no Troika, there will be some other form. For example, they can talk to the European Stability Facility. What does this change though? Does it change the ratio of debt to GDP? Does it change the structure of the Greek economy? Does it change the solvency of Greece?

Incidentally, it is a speculation that Greek debt is not sustainable. Usually they present its ratio to GDP, which is actually far above the limit at which a debt is considered sustainable, namely 120% of GDP. However, I have talked to economists who say that if the shares the Greek government holds in the Greek banks that were nationalised during the crisis were subtracted from the debt, the ratio would fall to 120%. Secondly, the large payments on the Greek debt are due after 15-20 years. There are now mainly interest payments on which Greece’s expenditure is much lower than that of Portugal and Ireland, for example. That is, not the amortisation of the debt but the cost of servicing the debt is lower than in other countries in the euro zone, which were in a position similar to that of Greece. This is difficult to defend when you sit down to talk with the lenders. They will say, "Why did Ireland have 4.6% growth last year?" And you just have nothing to say to them. "Why are you halting the privatisations since you think you will make them fairer? Markets will not wait."

And as we have previously talked about reactions, I think the most accurate and most objective is the reaction of markets. On Thursday, the European Central Bank stopped the cheap financing for the Greek government. That is, it stopped to accept Greek government bonds as collateral for refinancing. This was a result of the decision of the new government to withdraw from the agreement (memorandum). Greek bonds have anyway long been qualified in the lowest non-investment grade and this step has already classified Greece as an unreliable debtor. The ECB was accepting Greek bonds as collateral for loans because the previous government had adopted the plan and it negotiated with the Troika. The reaction of the ECB is not political, it is a market reaction.

I also think that noone in Europe will destroy the arrangements that were achieved in the Economic and Monetary Union during the crisis in terms of economic and financial management just to avoid destabilising Greece. I think that the partners will do their best for Greece to remain internally stable, to start making reforms and preserve the growth that is already noticeable this year and will continue in the following one. It would be irresponsible to waste this opportunity for all Greeks.

We are seeing a great revival of anti-European sentiment in Europe. Currently, the Greek parliament majority belongs to the Eurosceptic parties. In Spain, Podemos is already the second political force too, etc. How would you explain this reaction of European citizens and what could Europe do to change this?

As I said at first, the radicalisation of political societies is a natural consequence of the economic crisis. Traditional parties are currently paying the political price for their policies that caused the debt crisis and for the way they subsequently handled it. I do not mean that this way was infallible. To the contrary, it is the subject of much criticism.

But to destroy Europe because it was not perfect means to throw out the baby with the bath water. United Europe is not the problem, it is the solution.

The rise of anti-European and Eurosceptic movements everywhere is not new. We saw this during the European elections. Let me recall that the National Front in France won 25%, the UK Independence Party in the United Kingdom won 25% as well, the movement Five Stars in Italy was second in the elections too, although it was expected to win.

However in Italy, which has serious economic problems too (its debt is 133% of GDP and it is implementing painful reforms), the traditional left has long achieved unprecedented victory in the European elections.

I think that this anti-European reaction will not be equally strong or the same in different places. While we can expect that leftist parties and movements will represent it in southern Europe, among debtor countries, due to the high poverty and the derating of much of the left electorate and its transition to the far left, we will see the opposite in the north, in the lending countries that are the net contributors to the EU budget. There we will see protectionism, nationalism, far right movements on the rise.

The most important elections this year will be held in the UK. Polls indicate that neither of the two major parties, the Conservative and the Labour parties, will have a majority, and that Nigel Farage's party, which supports the idea of Britain exiting the EU, will most likely fail to enter parliament and play a balancing role.