The Prime Minister Alexis Tsipras, who is currently in Davos for the annual World Economic Forum, participated in a panel meeting with French and Dutch counterparts, Manuel Valls and Mark Rutte respectively, as well as German Minister of Finances Wolfgang Schäuble.
During the discussion PM Tsipras underlined how Greece is facing two crises at present – an economic crisis that generates political threats that may divide Europe and the refugee crisis. The Greek PM stressed that the human drama played out in the Aegean is shameful and that Europe must decide if it will work to solve the problem united, arguing that the EU cannot be an “a la carte union”.
PM Tsipras underlined the need for a reliable relocation mechanism to help refugees reach other European countries and to put a stop at the human trafficking in the Aegean. The Greek PM also stressed that a reliable mechanism is also required to help refugees return to Turkey.
The German Finance Minister agreed with the Greek PM, adding that it is shameful for Europe to turn into a fortress. Mr. Schäuble warned that unless the situation on the European borders is addressed, then Europe will face serious problems. Likewise, the Dutch PM commented that the refugee crisis must be in the next two months, since the flow of refugees is expected to increase in spring, when weather conditions improve. The French PM warned that Europe may fall apart and that realism and solidarity are necessary.
Reforms, investments and the IMF
As expected, the Greek bailout program was also debated during the panel meeting, with PM Tsipras explaining how Greece has achieved a major fiscal adjustment, but at the cost of 25% of the GDP and an explosion of unemployment. Aside from structural reforms and balanced budgets though, the country needs European and private investments, to support the much-needed political stability.
In response, the German Minister of Finances recognized that while solidarity in Europe is important, especially for a country that is unable to address its problems without support, it is equally important to respect rules and regulations. Mr. Schäuble further noted that the IMF was important, since the European institutions proved to be unable to tackle the Greek problem.
