Tsipras: “Agreement in sight, but not at the expense of pensions and benefits”

In an interview for Corriere della Sera, the Prime Minister Alexis Tsipras appeared confident of reaching an agreement with Greece’s partners and creditors, but warned that this cannot occur at the expense of benefits and pensions.

According to PM Tsipras “we have submitted a full text, including common ground identified during technical negotiations in the Brussels Group. We will be working to bridge the gap on state finance, putting forward alternative proposals where demands are irrational and unacceptable”.

Reaching an agreement though will require the institutions to be willing to find serious solutions for debt sustainability and explained that the “problem is that some of them are reluctant to acknowledge that the Greek reforms of past five years have failed because to do so would entail a cost. Europe and the institutions must recognize that austerity has failed. This is not an easy decision but we have to consider the economic cost of perpetual crisis or, even worse, the historic cost of failure”.

When asked about Greece’s rejection of the proposal submitted by the institutions, the Greek PM responded that “we cannot persist with a program that has clearly failed. It is not possible that we should be asked to apply measures that no one else in Europe has implemented, or that Greece should be forced to act as if there had not been an election that changed the government four months ago. It’s an issue of principle but also one of substance. After five years of austerity, it is inconceivable that we should be asked to abolish the lowest pensions or benefits that affect our poorest citizens”.

Crucially though, the Greek Premier estimates that a Greek bankruptcy will “be the beginning of the end for the Eurozone”. He then wondered “if Europe’s political leadership is unable to handle a problem like Greece, which represents 2% of its economy, how will the markets react for countries with much bigger problems, such as Spain and Italy” and commented that “If Greece goes under, the markets will immediately seek out the next one. If negotiations should collapse, the cost to European taxpayers will be huge”.