10 Days Remaining

Monday 20th
posted by James Tweedie in World

FORMER Greek finance minister Yanis Varoufakis has warned that EU-imposed austerity measures are doomed to failure.

Mr Varoufakis told the BBC over the weekend that the bailout programme will “go down in history as the greatest disaster of macroeconomic management ever.

“This programme is going to fail whoever undertakes its implementation,” Mr Varoufakis said. Asked how long it would take, he replied: “It has failed already.”

Greece could get up to €86 billion (£60bn) in loans to help pay off previous dodgy debts in return for a implementing raft of draconian measures, including pension cuts, VAT rises and handing over €50 billion (£35bn) worth of state assets to a holding company as loan collateral.

Mr Varoufakis said that Prime Minister Alexis Tsipras was forced to accept the measures “at gunpoint.

“We were given a choice between being executed and capitulating. And he decided that capitulation was the optimal strategy,” he said.

“I may disagree with him, and I declared that by resigning my post, but I understand the very difficult position in which he finds himself.

“We’re completely united in lambasting the highly undemocratic and economically irrational policies of the European Union.”

Mr Varoufakis resigned under pressure from the Eurogroup clique of 19 finance ministers following the overwhelming No vote in the July 5 referendum on the creditors’ demands.

He was followed out of government by several members of the ruling Syriza party’s Left Platform who had rebelled in Wednesday’s vote on EU-dictated austerity.

Energy Minister Panagiotis Lafazanis was replaced by former labour minister Panos Skourletis, possibly jeopardising an agreement with Russia to route a gas pipeline through Greece that Mr Lafazanis negotiated.

Also sidelined were Deputy Labour Minister Dimtris Stratoulis and Deputy Defense Minister Costas Isychos.

German Chancellor Angela Merkel ruled out debt relief for Greece yesterday, a concession that Mr Tsipras had earlier mooted, although Germany may be flexible about repayments.

Greek banks will reopen today after three weeks