Anger Across Eurozone as Officials Admit ‘Greek Debt Will Never Be Repaid’

AP Photo
The Associated Press

An admission that Dutch taxpayers are unlikely to ever see the €12 billion they have lent to Greece returned has sparked a backlash against continued bailouts in the Netherlands.

Kees Vendrik, chairman of the Dutch court of audit has provoked fury by admitting that Greece is unlikely ever to pay back the €240 billion received in payments from other Eurozone members and the International Monetary Fund, the Times has reported.

Appearing on Dutch television, he said: “As it now stands, I have to be honest, it’s going to be very difficult. Greece is plagued by all conceivable economic ills: an acute budget crisis, a financial crisis, an economic crisis, a crisis of competition, tax evasion, and a state apparatus and tax collection that does not function properly.”

Talks to prevent a Greek default as early as this Friday are still in deadlock as the Greek left wing government continues to stall over austerity measures.

The Dutch government has previously insisted that the money lent by Dutch taxpayers will be repaid with interest, but as that prospect becomes unlikely, so the Dutch people grow increasingly angry over the way the matter has been handled.

Campaigners have already handed a petition signed by 40,000 people in to the government demanding that a parliamentary investigation into the handling of the Greek debt take place. Thierry Baudet, a Dutch academic and Eurosceptic campaigner has asked simply: “How was it possible that such momentous decisions were accompanied by so little critical debate?”

Parliamentarians throughout the Eurozone will be asked in the coming weeks to decide on whether or not to grant Greece a further €7.2 billion in loans to prevent the country going bust. It will then require a third payment of between €30 and €50 billion over the summer to stay afloat.

The vast sums involved are taking their toll on the patience of Eurozone member states,  including Netherlands, Germany, Austria and Finland, whose citizens are growing increasingly resentful. In addition, the IMF is now pushing for creditor nations to grant debt relief, meaning that Greece’s debts will go unpaid for the foreseeable future.

Thijs van der Plas, a senior Dutch diplomat responsible for European cooperation has acknowledged the legitimate concerns of the public on the matter, saying: “The euro is potentially an enormous divisive issue and erodes public support for European cooperation, particularly in the Netherlands,” according to the Financieele Dagblad newspaper.

IMF and Eurozone officials will today hold a telephone conference on an “ultimatum” drawn up by Greece’s creditors, insisting that the country implement drastic austerity measures or risk having funding withdrawn. The measures are likely to include pensions cuts, a proposal which has not gone down well in Greece.

Alexis Tsipras, the Greek prime minister who rose to power on an anti-austerity ticket with his party Syriza has insisted that his government will not back down over the austerity plans. He has instead issued a 47 page draft plan to counter Brussels’ proposals.

“If we’re talking about an ultimatum which is not within the framework of the popular mandate, it is obvious that the government cannot co-sign and accept it,” his spokesman said.

However, Greece has confirmed that it will meet a debt payment of €310 million due on Friday, despite earlier threats not to pay up. A senior Greek finance ministry official has said: “Short of any major surprise, or sudden political decision, the June 5 payment will go through. So too, will the next one, for €348 million on June 12.”

However, a third payment of €581 million is due to be made to the IMF on June 16, at the same time as €1.2 billion is required to pay pensioners and public sector workers. Without bailouts from the IMF and Eurozone, Greece will be unable to meet these payments and faces bankruptsy. “Things will get difficult, very difficult,” the official said.

In January of this year, shortly after Syriza took power, Conservative MEP Daniel Hannan made the case for a Greek exit from the Eurozone.

“The past six years have seen a greater depression in Greece than that of 1929 to 1935. Output is down by an almost unbelievable 25 per cent. A quarter of all Greeks – half of all youngsters – are unemployed, and tens of thousands more have emigrated in search of jobs,” he pointed out.

“At least a default and devaluation would offer a fresh start. Although the economy has been pummelled by six years of Euro-austerity, some of the fundamentals have improved.

“The bureaucracy has been slimmed, taxes are now collected and, if debt repayments were taken out of it, the budget would be in balance. In truth, this is what EU leaders fear. Not that Greece will leave the euro and collapse, but that Greece will leave the euro and prosper.”