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A grumpy greeting for the Greeks

One day after naming his new cabinet, Alexis Tsipras, Greece’s new prime minister, begins a much harder task: closing the gap between his euro-zone partners’ demands for reform and austerity, and his voters’ cries for change. The creditors’ mood is hardly welcoming. The Germans fear emboldening Syriza-like parties elsewhere in Europe. The Finnish government, facing a difficult election in April, has nothing to gain by being nice to Mr Tsipras. Four national parliaments (in Estonia, Finland, Germany and the Netherlands) must approve an extension to Greece’s bail-out, which expires at the end of February. Greece should therefore expect no cut in nominal debts nor permission to backpedal on major reforms, though optimists detect room for compromise on debt maturities and details. European officials have so far limited themselves to statements of respect for the outcome of Greece’s election, coupled with warnings that the country must stick to its reforms. Whether the two are compatible remains unclear.

Jan 28th 2015
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