Greece delivers bailout proposals to its bailout creditors: EU Commission

Greece’s left-wing government has delivered a list of reforms Tuesday to debt inspectors for final approval of extended rescue loans, officials from the European Commission said. Greece and bailout creditors have been in a standoff since Prime Minister Alexis Tsipras’ left-wing Syriza party won general elections last month on a pledge to tear up bailout agreements and seek a massive write off of bailout debts, totaling 240 billion euros ($271 billion). But they reached a tentative agreement Friday to extend the country’s rescue loan program by four months, avoiding the risk of a Greek default and exit from the euro currency. Prime Minister Alexis Tsipras was already facing dissent within his left-wing Syriza party over claims it is backtracking on its recent election-winning promises to ease budget cuts for the recession-battered Greeks.

Creditors will be skeptical. These are notoriously difficult reforms and, in the case of the latter, usually cost money. It will be difficult for the Greek government to provide concrete measures for achieving these goals, and they will almost certainly be unable to achieve much before the next round of negotiations in June.

Megan Greene, chief economist at Manulife Asset Management.

The government official said reforms would focus on curbing tax evasion, corruption, smuggling and excessive bureaucracy while also addressing poverty caused by a six-year recession. A Syriza official in Brussels said that “immediate priority” would be given to the settling of overdue debts, the protection of people with mortgage arrears as well as the ending of foreclosures of first residencies.

Red lines in negotiations cannot be crossed - that’s why they are red. If the Germans choose to push the issue to a rift, they will bring catastrophic consequences on themselves.

Greek Environment Minister Panagiotis Lafazanis

Greece reforms Europe