euro crisis

Stop Forcing Reforms on Greece

I want to break free. Greek Prime Minister Alex Tsipras must disentangle the country from the EU. Source: Reuters
I want to break free. Greek Prime Minister Alex Tsipras must disentangle the country from the EU.
  • Why it matters

    Why it matters

    The European Union cannot insist a democratically elected government implement reforms that most of the population does not want.

  • Facts


    • Greece receives net annual transfers of more than €4 billion from the budget of the European Union.
    • A significant chunk of loans to Greece also comes from Greek banks.
    • In recent months, many bank customers have transferred money abroad or withdrawn cash.
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Germany’s finance minister Wolfgang Schäuble has given Greece’s charismatic new prime minister Alexis Tsipras a clear warning: the Greek government must face up to reality soon enough. He should have added that Greece’s creditor nations can expect an unpleasant wake up call too.

Germany and its partners must abandon their illusions that Greece will continue as it is doing now, accepting credit in return for compulsory reforms. New lines of credit will in fact simply become transfers of cash. If the Greek government continues to be presented with the choice of plunging into financial chaos or receiving new credits in return for budgetary prescriptions, it will of course accept the credit and agree to any reforms the creditors ask. But it will have no intention of actually putting those reforms into practice. It has no mandate for that course of action.

The government was elected to end the assistance program. It is arrogant and naive to believe that Europe could change the country with far-reaching reforms against the will of the Greek population. Reforms must be implemented with the support of the Greek population and political system, or they will not work at all.

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