'Time is running short' for Greece as another bailout summit looms

Yanis VaroufakisREUTERS/Alkis KonstantinidisGreek Finance Minister Yanis Varoufakis attends a news conference to present the ministry’s new general secretaries at the ministry building in Athens March 4, 2015.

Europe’s finance ministers are back at the negotiating table in Brussels today, and Greece is at the top of the agenda again.

This time they’re deciding whether Greece’s shopping list of economic reforms is good enough for the country’s bailout extension to proceed. The country’s proposals to boost tax revenue include recruiting tourists as amateur inspectors.

The meetings between Greece’s government and the eurozone’s finance ministers in February were heated, with finance minister Yanis Varoufakis and Eurogroup chief Jeroen Dijsselbloem reportedly nearly coming to blows during a meeting. Tensions are still high and there could be more drama Monday.

There has been a flurry of commentary and reporting ahead of the Eurogroup meeting – which begins at 2:30 p.m GMT (10:30 a.m ET) – the European Central Bank’s Benoit Coeure said that “time is running short” to approve the bailout in a Cypriot newspaper interview on Sunday.

Alexis Tsipras, Greece’s Prime Minister, seems to blame the ECB itself for that: He told German magazine Der Spiegel that “the ECB is still holding onto the rope that is around our necks“.

And last but by no means least, Varoufakis reportedly told Corriere della Sera that if the bailout extension was rejected Greece could call a referendum on the issue. Greece’s finance ministry insists that Varoufakis was misquoted, but the threat of a referendum raises memories of the aborted referendum on austerity conditions in 2012. Greek polls showed solid majorities against the austerity conditions, and a “no” vote would have thrown Europe into crisis.

The German government is currently suggesting that it does not expect anything solid from the Eurogroup on Monday.

Here’s what Societe Generale’s analysts had to say about the day’s meetings:

Greece’s financial situation remains stretched. The Greek Finance Minister will try to lessen the Eurogroup’s resolve to wait until the review is concluded before releasing the funds. Recent comments from Eurogroup President Dijsselbloem suggested some compromise: in an FT interview, he talked about the potential of working with tranches, released in March, if and only if real progress in the reform process is visible.

Greece will highlight the recent reforms proposed by the Minister of Finance, including measures to tackle the humanitarian crisis, changes to tax collection, and the creation of an independent fiscal authority and a new body for tax inspections. However, these reforms may still be perceived as too vague and are still far from being adopted by the Parliament.

The government is still facing pressure at home from its own hard left. Anarchist riots started again recently, and Syriza’s political office was overrun by protesters over the weekend.

The Wall Street Journal also catalogued the rebellious tendencies of government ministers in Greece, some of whom are far more hardline than Tsipras and Varoufakis. The Left Platform faction of the governing coalition want to reject all privatisations (even ongoing bidding processes) and are happy to leave the eurozone if necessary.

As ever, Tsipras and Varoufakis are walking a tightrope between the demands of Europe, which is footing the bill but doesn’t want to be flexible about the country’s austerity measures, and their own country, where most people are now staunchly set against the eurozone’s institutions, but want to keep using the single currency.

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