Greece: Leaders lash out as tempers fray

As talks between Greece and its creditors drag on and pressure mounts on both sides to find a deal, relations between Athens and its European partners are getting worse, not better.

Tensions over reforms-for-aid negotiations came to a head Sunday when European Commission President Jean-Claude Juncker accused the Greek Prime Minister Alexis Tsipras of distorting what the creditors had proposed to make some headway in securing a deal for the country.

This was a very different picture from last week. Relations between Juncker and Tsipras appeared to have soured very quickly after what seemed to be an amicable meeting last Wednesday.

After the meeting with Junker, Tsipras said that “progress was made”. However by Friday evening in a speech to the Greek parliament , he lambasted Greece’s creditors, calling their proposals “absurd” and “irrational, blackmailing demands.”

Adding insult to injury Tsipras said he was “unpleasantly surprised” by the offer made by Juncker, who – as head of one of the three institutions overseeing Greece’s bailout program, along with the International Monetary Fund (IMF) and European Central Bank (ECB) – had helped to craft the alternative proposals.

Tempers frayed

Speaking at the Group of Seven (G-7) summit in Germany on Sunday, Juncker said he was a “little bit disappointed by the speech.”
“He was presenting the offer of the three institutions (to the Greek parliament) as a ‘take-it-or-leave-it-offer’. That was not the case. That was not the message given to him. He was presenting the offer of the three institutions as being mine and mine exclusively. He knows perfectly well that this is not the case. And he knows perfectly well that I was – during the meeting we had last Wednesday- perfectly ready to discuss on the main points where disagreements are between Greece and the three institutions.”

“As I told you before, I am waiting for an alternative proposal of our Greek counterparts. I do not have a personal problem with Alexis Tsipras, quite the contrary. He was my friend, he is my friend. But friendship – in order to maintain – it has to observe some minimal rules,” Juncker said.

Craig Erlam, senior market analyst at currency trading firm OANDA, said in a note Monday that there needed to be more compromise from both sides.

“There needs to be some compromise from both sides, albeit probably much more from Greece being the debtor country, otherwise I fear we could be seeing them walking blindly towards disaster.”


Craig Erlam
Based in London, England, Craig Erlam joined OANDA in 2015 as a Market Analyst. With more than five years' experience as a financial market analyst and trader, he focuses on both fundamental and technical analysis while conducting macroeconomic commentary. He has been published by The Financial Times, Reuters, the BBC and The Telegraph, and he also appears regularly as a guest commentator on Bloomberg TV, CNBC, FOX Business and BNN. Craig holds a full membership to the Society of Technical Analysts and he is recognized as a Certified Financial Technician by the International Federation of Technical Analysts.