by Marcel Fratzscher
March 9, 2015
Europeans reacted with relief to what is widely seen as surrender last month by the Greek government in tense talks over an extension of the bailout programme for Athens. A return of the eurozone crisis had, it seemed, been averted or at least postponed. But Europe is about to repeat its biggest mistake of the past five years if it is trying to force the Greeks into a capitulation in the negotiations.
The first two Greek rescue programmes since 2010 failed mainly because ownership of the reforms was not taken by previous Athens governments or by the population at large. The governments therefore did the bare minimum required to secure the next programme payment.
At the same time they took every opportunity to attack the monitoring “troika” — the European Commission, the European Central Bank and the International Monetary Fund — and blame Europe and the euro for their plight.
Greece’s only chance to emerge from the crisis is to take responsibility for its reforms. And that can only happen if the government is strong at home. Negotiations can only ever be successful if both sides can legitimately claim victory. Germany knows this all too well.