Greece’s Prime Minister Alexis Tsipras Thursday gatecrashed a meeting on E.U. Policy in eastern Europe in the hope that it would be easier to wring concessions out of a small number of key decision-makers rather than the massed ranks of his creditors.
He might have saved himself the effort.
Tsipras had met with German Chancellor Angela Merkel and French President Francois Hollande after the official sessions of an “Eastern Partnership Summit” held in Riga, Latvia, Thursday, talking until the small hours about the country’s bailout program and its increasingly precarious cash position.
But, as Hollande had already indicated Thursday, there was no deal. Greece is still running out of money fast, and the remaining €7.2 billion still earmarked for the bailout remains frozen.
Arriving for a second day of talks at the summit, Merkel told reporters that there was no way around a three-way solution with the institutions that are overseeing the bailout negotiations: the European Commission, the European Central Bank and the International Monetary Fund.
“It was a very friendly, constructive exchange, but it’s clear that there is still a lot of work to be done with the three institutions,” Merkel said. “France and Germany are always willing to give help…but the agreement must be sealed with the institutions and some very, very intensive work has to be done.”
Tsipras’ government has repeatedly tried to bypass the technocrats from the “Troika”, saying it was beneath the dignity of a sovereign state to take orders from functionaries. But his effort to cut political deals at the highest level instead have come to nothing.
On Thursday, Tsipras was banking on an E.U. Tradition that France and Germany can push through any policy they want if they are sufficiently united, but while that principle may have held in the past, it is far more difficult to enforce in the context of the bailout, which depends on approval from a number of parliaments around the Eurozone, many in countries such as Slovakia and Latvia that are, at least on paper, poorer than Greece.
The Eurozone has been exasperated by Greece’s increasingly overt repudiation of past deals: since taking power in January, the government has rehired public-sector workers, re-opened a state-backed broadcaster and introduced legislation scrapping agreed reforms to higher education.
It’s now less than a week till Greece has to find money to pay some €2.5 billion pensions and public-sector wages. It then has payments due to the International Monetary Fund totalling €1.5 billion in the course of June, starting with a €300 million payment on June 5.
A government spokesman this week said the country would fail to meet those payments without help from its creditors. That may or not be ‘crying wolf’–Tsipras wrote the same to IMF managing director Christine Lagarde last month. Athens managed to make that payment, but only by raiding its own reserve account at the IMF.