July 03, 2017
Can Greece exit its programme without a credit line?
Alexis Tsipras is to defend his record and the eurogroup deal in parliament today, in an debate requested by New Democracy leader Kyriakos Mitsotakis. The eurogroup deal and the garbage collectors' strike provide plenty of material for a hefty exchange: the eurogroup deal is still unpopular, with no guarantee of a debt relief. And Tsipras’ new narrative that Greece could exit the programme without a precautionary credit line sounds like one of his many ambitious targets that he failed to deliver.
Market access is the new yardstick to measure the success of the Syriza government. Macropolis explains the logic: if they can get lower rates than New Democracy in 2014 and succeed in exiting the programme without a credit line like the one on offer to Antonis Samaras, then Syriza could argue that they did get a better deal and that it was worth the time and effort. The Public Debt Management Agency (PDMA) is reportedly already working on tapping the market twice in the coming weeks: to swap the three-year bond issued in July 2014, and to roll over a five-year bond issued in April 2014.
The domestic crisis last week was a strike of garbage collectors, which left many neighbourhoods with piles of rotting trash in temperatures of 40C. It has been resolved for now but only after some heavy interventions from the government. Unions suspended the strike on Thursday after Tsipras intervened and the government topped up with concessions, including plans to hire about 2,500 permanent staff next year. Garbage collectors were protesting against eventual job losses after a court order banned extensions to short-term contracts, which could leave up to 10,000 jobs on the line.