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Greece Makes Changes to Team Handling Debt Talks

GreeceYanis Varoufakis, the finance minister of Greece, the most indebted of European states, has rubbished reports that creditors have been sidelining him. He also stressed that he will continue to be part of negotiations to prevent his country’s bankruptcy. Greece recently made changes in its negotiating team taking into consideration the fact that its cash reserves were running too low.

The country also announced that Euclid Tsakalotos, an economist who studied in Britain, will be the chief negotiator between Greece and its EU lenders, the International Monetary Fund and the European Central Bank. But Varoufakis said that this does not mean that the significance of his role has diminished.

The country’s creditors, however, feel that changes in the negotiation team will make a huge difference. Brussels opines that the new team is “sensible” and “moderate.” Officials are looking forward to more involvement from Giorgos Houliarakis, who is associated with Yannis Dragasakis, the deputy prime minister. Houliarakis is now working toward getting another loan of €7.2 billion, which Greece badly requires.

Although his arguments hold water, Varoufakis’ counterparts feel that he has created a great deal of damage. As an EU diplomat puts it,

they made every mistake in the book. They solidified eurozone opinion behind the Germans. Everything that Varoufakis has done has been calculated to alienate

While admitting that “there is a negative climate,” Tsipras expressed his support of Varoufakis, referring to him as “an important asset for the government and the country. He has annoyed people because he speaks the language of finance ministers, of economics, better than they do.”

Reliable sources say that the negotiation team was reshuffled to placate critics of the finance minister. Some of those critics are Jeroen Dijsselbloem, who heads the eurozone finance ministers, and the European Central Bank (ECB). The Greek premier had commented to Greek’s financial problems have been made worse by the ECB’s “politically and ethically unorthodox” policies. Dijsselbloem responded:

The Greek government gambled that if it negotiated with us, the ECB would open its cashier windows, relax the rules. There will be no easy access to the ECB’s windows until there is a solid agreement with the Eurogroup. That’s been made clear to them time and time again.

Currently, Greece is facing a tough deadline to start repaying its debts. The first installment of €780 million has to be repaid to the IMF on May 12th, shortly after a eurogroup summit.