The Greek economy and its global partners: A conversation with Greek Finance Minister Yanis Varoufakis

A conversation with Yanis Varoufakis

Kemal Derviş and David Wessel
Since 2010, the economy of Greece has repeatedly faced challenges initially brought on by the global financial crisis. Over the past five years, various Greek governments have sought to overcome these challenges, restructure debt, and renew the country’s economy with some, but limited, success. Unemployment remains close to 25 percent and the cumulative loss of GDP has approached 28 percent. Conversations with partner governments in the eurozone have at times been contentious. Now, a new party has been elected in Greece and is charged with tackling its fiscal challenges, and conversations continue to swirl about what lies ahead.

On April 16, the Global Economy and Development program and the Hutchins Center on Fiscal and Monetary Policy at the Brookings Institution hosted Greek Minister of Finance Yanis Varoufakis to discuss what faces the Greek economy, the prospects for reform and economic renewal, and the details of any future strategic agreement among Greece, its European partners, and the International Monetary Fund.

After opening remarks by Minister Varoufakis, there was a short conversation with Kemal Derviș and David Wessel of the Brookings Institution.

Citizens of Korydallos District React to the Upcoming Golden Dawn Trial

by Aggelos Skordas – Apr 13, 2015
published at

The upcoming trial of Greece’s extreme right Golden Dawn party, scheduled for April 20, has caused the firm reaction of citizens and business owners in the district of Korydallos, Athens, where Greece’s largest prison is located. The Nazi-inspired party members’ and supporters’ trial is to be held in a specially designed room inside the prison. Among the 70 charged of running and belonging to the xenophobic criminal organization are the party’s leader Nikos Michaloliakos and MPs Ilias Kasidiaris, Christos Papas, Ioannis Lagos, Giorgos Germenis, Nikos Kouzilos, Panagiotis Iliopoulos, ex member Stathis Mpoukouras and one underaged person that will be tried separately.

Local officials are bracing for trouble, noting that anti-fascist groups have already called protests at the beginning of the trial. “The trial cannot and must not be held here,” Korydallos’ mayor Stavros Kasimatis told French news agency AFP, adding that “this is Greece’s biggest trial in 40 years. It will last at least 18 months. There will be anti-fascist group gatherings and Golden Dawn supporters will perhaps muster as well.” Continue reading

Greece fears hit stocks; IMF seen cutting growth outlook ‘significantly’

by Holly Ellyatt | Jenny Cosgrave
published at

Protesters march on April 9, 2015 with a banner, reading ‘Write off the debt now,’ during a small protest in Athens.Greece growth projections will need to be “significantly” revised down, the European head of the International Monetary Fund (IMF) told CNBC on Friday, as fears of a default weighed on European and U.S. stock and bond markets.

The IMF estimated on Tuesday that Greece’s economy would grow by 2.5 percent this year and 3.7 percent in 2016—forecasts that bemused some analysts aware of the country’s hefty debt burden and deadlocked talk with international creditors.

On Friday, Poul Thomsen, director of the IMF’s European department, admitted the forecasts were unrealistic.
“Our growth projection for this year will clearly have to be revised down significantly because of the current turmoil, because of the delay in completing the review. So once again, growth will under perform,” Thomsen told CNBC from the IMF’s annual Spring Meeting in Washington D.C.

Stocks and bonds were hit across Europe and in the U.S. on Friday, with Greece fears factoring in the slump. The country is seen as increasingly likely to default on its debt obligations, as negotiations with its international bailout supervisors have failed to succeed in bringing about a further tranche of aid. Continue reading

The Greek Stand-off: A Proper Sense Of Perspective Is Urgently Needed

by Andrew Watt on 16 April 2015
Media reports indicate that the stand-off between the new Greek government and its creditors is going to the wire. At stake is Greece’s continued membership of the euro area. Much has been written on the lack of progress and understanding between the two sides. In many cases reports are based on little more than gossip, often launched, one can safely surmise, with an explicit view to influencing the outcome of the negotiations. Seemingly every conceivable argument has been dragged into the debate, no matter how far back in history. Continue reading

Weimar on the Aegean

originally  published at New York Times
FEB. 16, 2015

by Paul Krugman

This story is included with an NYT Opinion subscription.

Try to talk about the policies we need in a depressed world economy, and someone is sure to counter with the specter of Weimar Germany, supposedly an object lesson in the dangers of budget deficits and monetary expansion. But the history of Germany after World War I is almost always cited in a curiously selective way. We hear endlessly about the hyperinflation of 1923, when people carted around wheelbarrows full of cash, but we never hear about the much more relevant deflation of the early 1930s, as the government of Chancellor Brüning — having learned the wrong lessons — tried to defend Germany’s peg to gold with tight money and harsh austerity. Continue reading

Obama calls for flexibility in Greek reform talks in brief exchange with Varoufakis

Originally published at

US President Barack Obama spoke with Greek Finance Minister Yanis Varoufakis on the sidelines of an event at the White House honoring Greece’s Independence Day with the former stressing the need for flexibility from all sides in ongoing reform negotiations between Greece and its creditors, according to sources.

The conversation between Obama and Varoufakis lasted for around 12 minutes, according to sources who said Varoufakis asked Obama to keep pressing European leaders so that a solution is found to Greece’s problem. Varoufakis agreed with Obama that all sides need to show flexibility and also highlighted the need to remain focused on the goal and on the process that Greece is involved in with its creditors.

The event at the White House was also attended by US Vice President Joe Biden and Greek Archbishop Demetrios.

Varoufakis is to meet on Friday with US Treasury Secretary Jack Lew at 10.30 p.m. Greek time following a scheduled meeting at 6 p.m. with European Central Bank President Mario Draghi.

On Thursday, in a speech at the Brookings Institution, Varoufakis underlined the difficulties in Greek negotiations with its creditors but said Greece was more keen than anyone for a deal to be reached. Nevertheless, Greece will not approve more austerity, he said. “We will not sign up to targets we know our economy cannot meet by means of policies that our partners should not wish to impose,” he said. “We will compromise, we will compromise and we will compromise in order to come to a speedy agreement. But we are not going to end up ‘being’ compromised. This not what we were elected for.” , Friday April 17, 2015 (11:25)

Greece’s Varoufakis to meet Obama, ECB’s Draghi amid debt talks

published at Reuters | Tue Apr 14, 2015 3:01pm EDT

Greek Finance Minister Yanis Varoufakis is surrounded by members of the media as he finishes comments on the ”informal discussions” he just concluded with the International Monetary Fund Managing Director Christine Lagarde, in Washington, April 5, 2015. REUTERS/Mike Theiler
Greek Finance Minister Yanis Varoufakis is surrounded by members of the media as he finishes comments on the ”informal discussions” he just concluded with the International Monetary Fund Managing Director Christine Lagarde, in Washington, April 5, 2015. Continue reading