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Opinion

Is this Greece's last month in the eurozone?

Another crucial week for Greece goes by, yet nothing has changed. The need for financial aid combined with left-wing phantasies heightens the tension in the European tragedy, says DW's Bernd Riegert.

June could be Greece's last month in the European monetary union if Greece's left- and right-wing coalition does not finally make a move. Once again, a dreaded deadline for payment to the International Monetary Fund looms overhead. Once again, we hear the cacophonous chorus of ministers who herald imminent bankruptcy and yet, at the same time, we hear of an impending breakthrough in negotiations with international lenders. It is hard to keep track of Greek finances; the radical government doesn't seem to be able to, either.

Instead of advancing the Brussels Group negotiations with solid, calculable proposals for action, Greek Prime Minister Alexis Tsipras (pictured above) indulges in accusations. He suspects a conspiracy of neoliberals in the EU is at work, making absurd demands on Greece and making an example of his country. The only absurd thing is the ideologically embellished theories he cites in the French newspaper LeMonde: The evil Europeans and International Monetary Fund are all to blame, laments the Greek prime minister.

Greeks have not kept their promises

Let us recall the fact that on February 20, Greece had agreed to take a few days to present a tangible list of reforms that would make it possible to receive more funding in April. This list has still not been submitted. The Greek government has listed a series of administrative reforms for tax authorities and VAT reforms. These proposals are aimed at broadening the tax base and raising tax revenues. It's a good way to start, but the plans are not good enough to balance the country's budget and get the Greek economy back on its feet.

The ill-fated finance minister Yanis Varoufakis has wasted precious time, especially with self-promotion in the media. Now time is really running out: On June 30, the deadline for further aid to Greece expires. An agreement with money lenders needs to be reached in mid-June at the latest in order to technically be able to ensure payments can be made. This still requires the approval of the finance ministers of the Eurogroup and the approval of several parliaments in member states. The Greek parliament still needs to draft some more reforms, which will not be easy, given the quarrels within the ruling Syriza union itself.

Crisis help line replaces policy

So what is Alexis Tsipras doing? Instead of sticking to the Eurogroup's clear processes, he has resorted to telephone counseling. Almost every day now, he calls Chancellor Angela Merkel and French President Francois Hollande. He seeks a political solution at the highest level. On several occasions, the EU summit has made it clear that there is no lack of political will to keep Greece in the eurozone: There are simply no clear commitments from Athens to meet the conditions for further loans. Of course, plans for further restructuring in Greece need to be discussed and negotiated – and of course, at the highest political level.

But first of all - and Alexis Tsipras should know this - the acute financial crisis in Greece must be resolved before Greece is catapulted out of the eurozone, warn the G7 finance ministers; above all, the United States. Greece needs breathing space. Prime Minister Tsipras can meet with Merkel, Hollande and EU Commission President Juncker as often as he likes: Decisions are made by the Eurogroup - all 19 states - and must be unanimous.

Four disastrous months

The responsibility for the worsening financial crisis in Greece lies with the present team in Athens, which does not want to try harder, or perhaps does not know better. Since the government took office in February, the Greek economy has fallen back into recession, from which it had just managed to emerge. The budget surplus after deduction of debt service has turned into a budget deficit. Investor confidence is completely shattered. Tourist bookings are dropping.

To remain solvent, the government is scraping together public insurance, university and hospital funds. A reserve account of the International Monetary Fund has been misappropriated. The European Central Bank keeps the Greek banks alive; in the meantime, investors are withdrawing all their money from banks and sending it abroad ,or putting it under their pillows. This simply cannot continue.

Act or resign

Greece and Europe now need brave decisions from the government in Athens. Or the Greek government needs to move over and let someone else take over. Syriza's performance has been a fiasco. Even if it succeeds in keeping Greece in the eurozone after June 2015, no one knows what will happen next. Europeans and investors have lost confidence in Greece. Who will negotiate and finance the needed third aid package for Hellas in July? Tsipras' accusations in newspaper articles and his phone calls to leaders who allegedly belong to a neoliberal conspiracy do not help matters. Greece deserves better. Alexis Tsipras must finally stop talking and start acting. If he cannot, then elections are the best solution.

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