The Malta Independent 13 July 2015, Monday

Greece could have obtained a less humiliating result two weeks ago - PM Muscat

Monday, 13 July 2015, 09:32 Last update: about 53 minutes ago

Speaking to the Maltese media at a rather hasty press briefing held at the end of the record European Council, Prime Minister Joseph Muscat said the Greek government had effectively surrendered on all fronts.

Greece would have obtained a less humiliating result had it agreed to the draft agreement that was rejected by the Greek electorate in the referendum.

The Greek parliament will now have to approve four laws by this Thursday and a further two by next week.

The insistence that surfaced over the last pre-summit days that Greece deposits assets as a guarantee had raised Greek hackles till the very end. Agreement has been reached that this guarantee will no longer be housed in an institution in Luxembourg but in an institution to be created in Greece itself that will be managed by European institutions.

The first EUR 25 million from this guarantee's profits will go to pay back the recapitalisation of banks and the rest to pay back the national debt and to create investment.

The Council understood that the figure of EUR 50 billion that has been mentioned is a target that may not even be reached although this fund will take three years to be built up.

The Member States will fork out some EUR 35 billion over a period but only if Greece commits what it has promised. There are various funds from which these sums can come, from ESM, and these have their own strict regulations that will be all observed. Among other rules, some countries insist on a vote in parliament before such funds can be released.

Besides, the EU will also offer bridge financing according to modalities and rules to be drawn up and managed by the Eurogroup.

The ECB will also be contributing according to its own modalities and rules.

Replying to questions, Dr Muscat admitted that what took place at the summit was 'not a pretty sight' that could have been avoided.

Malta had its own red lines and these have been respected, especially that no haircuts will be carried out and thus Malta's loans to Greece will be all returned back.

He said it is never wise to humiliate anyone but Greece has ended this summit as a humiliated country, mostly brought about by its own refusal to accept the package presented a fortnight ago. Had Greece accepted this package then, it would have obtained a better deal.

Asked what will Draghi do now, Dr Muscat said the ECB has its own rules and its own independence. It will take note of the conclusions of the summit and the fact that the Greek government and parliament will have carried out what was committed and act accordingly.

Most of the delays over this long night were caused by Premier Tsipras carrying out soundings with most parties in the Greek parliament to ensure the laws will be agreed within the set timelines.

Dr Muscat was crystal clear: if the parliament does not agree on these laws, the deal is off and Plan B, meaning Grexit, comes in.

On the political level, some of the countries which were reluctant to lend more funds to the Greeks have a difficult situation at home where a coalition government may be defeated.

As regards IMF, which the Greeks absolutely refused to allow into the agreement, this has been solved and the Greeks made to take back their stance when it was explained that it was the ESM ttreaty itself that insisted on IMF collaboration.

Finally, Dr Muscat denied that at one point, Premier Tsipras had asked the heads of government if they wanted to take his jacket too.

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