BRUSSELS
The new Greek leftist government has now made a full-scale commmitment to the Eurogroup bailout program that it had campaigned against in its election in January.
In a letter from Greek Finance Minister Yanis Varoufakis to Eurogroup head Jeroen Dijisselbloem, which was leaked to Reuters on Tuesday, the radical economist promised to hew strictly to the program set out by Greece's creditors, the very plan that his party SYRIZA had campaigned against when it was elected in January.
The letter promises to allow ongoing privatisations and to leave those already completed alone, to maintain fiscal targets and not to change any reforms put through in the past.
The Greek government wishes to boost welfare spending, but Varoufakis promises in the letter to see that this does not involve dangerous spending.
Varoufakis also promises to chase tax evaders, eradicate corruption and and to "review and control spending in every area of government spending."
The revelations came as the German government requested an extension of the Greek bailout program from parliament on Tuesday, but made it conditional upon Greece's completion of the review process by creditors.
The motion submitted by the Finance Ministry and published on the German government's website, requested a four-month extension of the existing Greek bailout, but underlined it would only be put into effect if Greece's commitment to reform measures was considered “satisfactory” by the Eurogroup.
"This motion would be initiated on the condition that Greece has submitted the first list of reform measures, the three institutions (IMF, European Central Bank and European Commission) have given their first assessment and that these measures are considered satisfactory as a starting point for the successful conclusion of the ongoing program,” the ministry said in the motion.
The German parliament is expected to vote on the motion at some point this week, depending on the outcome of a teleconference among the Eurozone finance ministers scheduled for Tuesday afternoon.
German Finance Ministry spokesman Martin Jaeger said at a press conference in Berlin: "I see no reason for not being able to extend the program this week, but of course this depends on the quality of the economic reform program to be sent by Athens.
Separately, the European Commission signed off Greece’s reform proposals on Tuesday, saying the list “is sufficiently comprehensive to be a valid starting point.”
However, President of the Eurogroup Jeroen Dijsselbloem said although Greece is serious about its reform commitments, it will take time to agree on the details of its reform plans.
Dijsselbloem told the European Parliament on Tuesday after Athens submitted its reform list: “I think they are serious but it’s not going to be easy. This is just the first step. It’s going to take time to get into details which will carry us on for four months.”
“I think they’re very serious but it’s a new Greek government with a different political vision than the previous one. Therefore they wan’t changes with the agreement,” Dijsselbloem said.
