09-07-2018 | EYE ON GREECE | EU

09-07-2018 | EYE ON GREECE |

Monday, July 09, 2018

IMF auditor: High fiscal targets threaten Greek econ growth; Vijlbrief: Pension cuts to proceed

The new head of the IMF’s mission to Greece, Peter Dolman, was quoted in the Sunday edition of Athens’ “Kathimerini” as warning that high primary budget surpluses (as a percentage of GDP) that the Tsipras government has committed Greece to achieving in the near future could threaten economic growth.


FAZ: Eurogroup decisions for Greece a ‘4th memorandum’, a 5th will follow

Frankfurter Allgemeine Zeitung (FAZ) again takes a very critical look at recent developments concerning the Greek program, assessing that a June 21 Eurogroup decision to finalize medium-term debt relief measures for the country is a “de facto fourth memorandum”.


Tsipras-Erdogan meeting at NATO summit expected to touch on fate of 2 Greek servicemen; Ankara links issue with asylum seekers

A meeting between Greek Prime Minister Alexis Tsipras and recently re-elected Turkish President Recep Tayyip Erdogan on the sidelines of a NATO summit this week is increasingly viewed as crucial for the release of two Greek servicemen, which continue to be held in pre-trial detention in the neighboring country since March 1.


FYROM’s NATO accession hinging on name deal

The final declaration of the NATO summit in Brussels this week is expected to state that the accession of the Former Yugoslav Republic of Macedonia (FYROM) to the North Atlantic Alliance hinges on its ratification of the name deal signed with Athens last month, according to a draft seen by Kathimerini. The conditionality will, reportedly, be noted in articles 59 and 60 of the declaration.


Government puts off granting right to vote to Greeks overseas

The government on Friday effectively rejected a proposal by conservative New Democracy to amend voting laws so that Greeks living overseas can participate in general elections.


Exports advance 12.4 percent in first five months of year

Greek exports – including fuel products – recorded a double-digit growth rate in May compared to the same month last year, according to data published on Friday by the Hellenic Statistical Authority (ELSTAT).


ATHEX: Banks decline on National’s plan for a reverse split

National Bank’s intention to carry out a reverse split on its stock and the fresh escalation in the international trade war involving the US, China and Russia led Greek blue chips lower on Friday, while mid- and small-caps posted gains.









KATHIMERINI: IMF: High surpluses “choke” growth

TO VIMA: Polarized elections ahead

REAL NEWS: ‘War’ within NATO for the two Greek servicemen captured by Turkey

PROTO THEMA: Double bluff by the government on the Skopje deal and upcoming pension cuts

AVGI: Labor relations are the great social bet


ETHNOS: Kappa Research Poll: The election game in Attica

TA NEA: Taxes for real estate transfers to spike

EFIMERIDA TON SYNTAKTON: Berlin pressures Athens and Rome to get back migrants

KONTRA NEWS: Great fraud regarding polls

DIMOKRATIA: Retrospective payments to 250,000 servicemen

NAFTEMPORIKI: New scenery in the real estate field

DD RESIGNS: The U.K.’s Brexit Secretary David Davis resigned shortly before midnight on Sunday, with a withering assessment of Theresa May’s new plan for Brexit. Steve Baker, the U.K.’s minister in charge of a no-deal Brexit scenario, and Suella Braverman, another Brexit minister, have reportedly followed him out the door. “It leaves a gaping hole at the top of the department set up by May to plan and negotiate Britain’s EU exit, less than nine months from Brexit day,” our London colleague Jack Blanchard writes.

It doesn’t particularly matter to Brussels who’s leading the U.K.’s Brexit charge as long as Theresa May stays put as prime minister. The EU’s chief negotiator, Michel Barnier, told leaders at their late June summit that he considers May’s EU adviser Olly Robbins to be his real counterpart in the discussions, people who witnessed Barnier’s gig told Playbook. Still, these latest resignations complicate things for the U.K. — and more concretely for its “strong and stable” government, which has had to deal with a resignation every six weeks or so.

It’s a major challenge for May, who’s facing her biggest crisis since the general election. Could other Brexiteer ministers follow suit and attempt to bring her down? Could the resignations, in fact, strengthen May’s position? Will they — and let’s not forget there are divergent interests on the EU side of things too — highlight the need to prepare for a no-deal Brexit? These are just a few of the many questions swirling around today and over the next few days. For those of you hungry for the immediate lowdown on the British fallout, keep an eye out for Jack’s London Playbook, hitting inboxes by 8 a.m. Brussels time.

GOOD MONDAY MORNING. What better way to start the stay than with a government in trouble, or (unless your name is Horst Seehofer, perhaps) revenge, served cold and on the rocks, among friends in government? More on that below. It looks like a full week ahead here. Who knows what U.S. President Donald Trump plans to do or say (let alone tweet) at the NATO summit coming up on Wednesday and Thursday? NATO has no idea, and neither does his administration. And so, whether the West’s security architecture will remain in place, undamaged, this time next week is anyone’s guess.


OUCH, THAT HURTS: When Germany’s interior minister, CSU chief Horst Seehofer, called for “unrestricted cooperation” on security matters with post-Brexit Britain in a letter to the European Commission, he was expressing his personal views, not speaking for the government. That’s what Germany’s permanent representation in Brussels assured the Commission in its own letter, dated Friday July 6, which Playbook has seen. The naked news: here.

The message to the EU and other governments: Disregard what our interior minister says. It’s very unusual for an embassy to contradict a minister — regardless of the minister’s seniority — to the point of telling Seehofer’s Brussels interlocutors (and 27 other EU governments) that his position on the issue is worthless.

Verbatim: “I would like to make it clear that [Seehofer’s] is not a letter agreed in the Federal Government,” senior diplomat Thomas Eckert — who currently represents the German government in meetings of the EU’s ambassadors, or Coreper II — wrote to a cabinet member of the Commissioner for home affairs, Dimitris Avramopoulos. “Parts of the letter are in contradiction with the guidelines of March 2018, issued by the European Council in its article 50 format, and to the position in this regard agreed by the federal government,” Eckert, the political director of the permanent representation, added.

His conclusion: “Insofar I clarify that the federal government of course sticks to the content of those guidelines and its position previously taken.”

WHAT’S GOING ON: This isn’t just damage control on a rogue Brexit proposal — Chancellor Angela Merkel herself has stressed the importance of cooperating on security matters with the U.K. after Brexit (see below on NATO and Trump). Germany knows it’s probably safer to avoid getting rid of yet another big military and intelligence power.

This is about Seehofer, whose letter was a highly unusual move that appeared designed to weaken Merkel’s authority the day before she met with other heads of governments to talk Brexit, among other issues, at the late June summit in Brussels. (His letter was dated June 27). Germany wants to make sure its reputation doesn’t take yet another hit, after Europe watched it narrowly avoid a coalition break-up following a weeks-long struggle over migration between Seehofer’s conservatives in Munich and the rest of the country. Putting Seehofer in his place, at the expense of his own reputation in Europe, is one way to do that.

Seehofer heads to Innsbruck on Thursday for his first EU appearance as interior minister. He’s due to talk migration and asylum, first with his peers from Austria and Italy, then with all EU ministers — and he’ll be speaking with all the authority of a German interior minister.


NEXT CONFRONTATION: According German newspaper Bild, Iran “intends to fly €300 million in cash from Germany to Iran” to avoid running out of money due to U.S. sanctions against the financial sector. Iran says it needs the money from its German accounts “to pass it on to Iranian individuals who, when travelling abroad, are dependent on euros in cash due to their lack of access to accepted credit cards,” Bild writes. It wouldn’t work, of course, without the knowledge and consent of German authorities, and it is sure to spark some anger, to say the least. Watch the Twitter sphere!

MERKEL’S NATO LINE: “The challenges for NATO have changed drastically in recent years,” Merkel said in a video statement published Saturday, adding that after Moscow’s annexation of the Crimean peninsula and its military activities in Eastern Ukraine it is important “to focus more on defending the alliance.” She’s back to the business of a stateswoman again, after weeks of internal fights with her Bavarian allies and ahead of a week that could present her with a more powerful opponent.

Some limited reassurances: Trade tensions between the U.S. and the EU have so far not bled over into the dispute about NATO allies’ military spending, according to the U.S. ambassador to NATO. “One thing I will say is that in all of the disagreements that we have seen at the G-7 and with allies with whom we are now having trade talks and negotiations and tariffs, that has not come up in the NATO context,” U.S. Ambassador to NATO Kay Bailey Hutchison told Fox News. “Our diplomats are professional and they are staying on our NATO issues, where we are 100 percent allied.”

Give Trump his due: “If NATO is to mean anything, Europe and the U.S. must be partners on an equal footing. That means Europe should respond seriously to American concerns that it is not pulling its weight — whoever delivers the message,” writes Matthieu Borsboom, a former vice admiral of the Royal Netherlands Navy, in an opinion piece for POLITICO.

FRENCH WARNING: As Berlin again flirts with the idea of offering Trump a TTIP lite deal, slashing tariffs, or coming to a plurilateral agreement on cars, French Economy Minister Bruno Le Maire issued a strong warning to his German neighbors, telling them not to risk dividing the EU over trade, our own Jakob Hanke and Hans von der Burchard write in to report. With a nod toward Germany, which has been much more cautious on further retaliation, Le Maire said: “If tomorrow there were to be new hikes of tariffs on other economic sectors such as the auto industry, our reaction will have to be united again, strong, to show that Europe is also a sovereign economic powerhouse.”

Wake up and smell the trade war: “In this globalized world, European countries must form a bloc, because what our partners or adversaries want is to divide us,” Le Maire said in Aix-en-Provence on Sunday. “What the United States want, that’s to divide France and Germany.” Le Maire said it was evident that the EU was already embroiled in a global trade war. “The question is not whether there will be a trade war or not,” he said. “The trade war has already started.”

On the global trade agenda today: Chinese Premier Li Keqiang is in Berlin today, along with several ministers, to meet Merkel and her cabinet for bilateral talks on trade, energy and more.


PROUD PM: U.K. Prime Minister Theresa May said ahead of the NATO summit she is willing to back Trump’s demand for more defense spending: “We’re meeting the pledge. A limited number of other NATO countries are meeting it. I would urge everybody to work towards that,” she told the Sunday Times.

Look at May! The PM might have thought she was in a good position to show the EU her strength (and Trump her diligence): Isn’t football coming home? Didn’t her government accept her plans to ask the EU for a trade agreement after Brexit? (Well, she had a 48-hour window before a certain resignation happened). It only took her two years and a bit to come up with that truly revolutionary idea, so isn’t it now for her to ask the EU side to speedily agree to that best of all Brexit plans? “Our message now is to the other side, to Europe, that it’s time to get serious and sit down and talk about it,” she said in an interview with the Sunday Times.

Take that, Michel Barnier: “It’s now for Europe to be prepared to sit down and move the pace of negotiations on and talk about it seriously and address what we’ve put forward,” May repeated. We’re at a point where Brussels is unimpressed by British bragging. It was MEP Elmar Brok, a member of the European Parliament’s steering group on Brexit, who make the point over the weekend. Shh, don’t tell, but the mantra in Brussels is: This isn’t a negotiation where the EU is ready to give, and besides, resignations in May’s Cabinet are hardly Europe’s problem in the first place.

Scenarios for May: How long will the “free trade area” deal hold internally, and how long will it take for the EU to point out inconsistencies? Barnier refrained from substantially commenting on the outcome of Friday’s Chequers meeting, and said he’d wait for the written procedure. (A British white paper is due this week). Tom McTague and Charlie Cooper lay out why May won’t be able to savor her victory for very long (indeed, the overnight resignations may have already burst that bubble). Here’s their guide to the next booby traps facing the prime minister.


ORBÁN’S DIRTY CAMPAIGN: Israeli private intelligence firm Black Cube was involved in a campaign to discredit NGOs ahead of Hungary’s April election, our own Lili Bayer reports. Between December 2017 and March 2018, Hungarian NGOs and individuals connected to American-Hungarian financier George Soros were contacted by agents using false identities who secretly recorded them. The recordings, which began appearing in the Jerusalem Post and Hungarian government-controlled daily paper Magyar Idők three weeks before Hungary’s election, were used by Prime Minister Viktor Orbán to attack independent civil society organizations during the last days of the campaign. His right-wing Fidesz party went on to win in a landslide. The full story here.

NO MORE FRONTEX PLEASE: Italian Interior Minister Matteo Salvini vowed to close the country’s ports to all rescue ships — including those belonging to the EU’s Sophia naval mission and European coast and border guard vessels. Remember: Sophia is an EU mission overseen by member states’ foreign and defense ministries.

BASTA: Ex-Prime Minister Matteo Renzi — still a powerful voice in the Democratic Party — offered an analysis of his party’s defeat in Italy’s March election at a party congress on Saturday. And he was merciless with everybody except, perhaps, himself. The party’s new leader, Maurizio Martina — elected by the congress that day — wasted no time in issuing a basta, Matteo. The PD should be attacking the “dangerous right” not those “who have served the country well.” (He was talking about Paolo Gentiloni, not Renzi). La Stampa has more.

DRUG WAR: A high-stakes plan to use U.S. courts to prosecute Taliban commanders and allied drug lords who supplied more than 90 percent of the world’s heroin ran afoul of the Obama team. Five years later, its authors hope the Trump administration will adopt the plan as part of its evolving strategy in Afghanistan. Our U.S. colleagues have the full story.