French president backs Greek government’s efforts to secure debt relief.

By Helen Popper, Politico.eu

Greece’s creditors must be flexible, French President François Hollande said Friday, as he called for prompt negotiations on easing the cash-strapped nation’s debt burden.

After casting himself as Greece’s No. 1 supporter during the summer’s grueling talks on a third multi-billion-euro bailout program, the French Socialist leader pledged solidarity with leftist Greek Prime Minister Alexis Tsipras over the implementation of bailout reforms during a two-day visit to Athens.

“When we finish the [bailout] evaluation we should start the negotiations about debt relief,” Hollande told reporters, stressing that Greece must keep its side of the bargain. “Only if Greece can keep its promises can we start talking about the debt.”

Representatives of Greece’s quartet of creditors — the European Commission, the International Monetary Fund, the European Central Bank and the European Stability Mechanism — are in Athens this week to assess the Greek government’s progress on implementing bailout reforms.

Successful completion of the first quarterly evaluation of the €86 billion program would pave the way for the recapitalization of Greece’s troubled banks to the tune of up to €25 billion.

Calling on French companies to invest in Greece, Hollande praised Tsipras’ “courage” in accepting the harsh bailout terms despite earlier anti-austerity pledges, and backed Greek calls for flexibility on sensitive issues such as foreclosures on indebted households.

“Greece wants a structure, a timetable and some flexibility, a word that we use very often here in Europe … we have to see what is the limit below which they cannot do foreclosures. It’s an important discussion that we have to continue,” Hollande said, adding that Europe was now more preoccupied with a possible Brexit than a Grexit.

 

Tax hikes and pensions cuts are already stirring discontent among labor groups in Greece, presaging a rough ride ahead for Tsipras, whose transformation from left-wing firebrand to center-left moderate is likely to appeal to Hollande as he faces criticism from the French left for betraying his socialist roots.

The French leader, who is plagued by low approval ratings and high unemployment, was quick to congratulate Tsipras on his return to power last month and will hope some of Tsipras’ election success rubs off two months before regional polls in France.

Tsipras, who was criticized this week for sacking the country’s top tax collector, said his government was enforcing sweeping reforms to state bodies but suggested the country was being subjected to unreasonable pressures.

“Greece has signed an agreement which it is going to follow. It did not sign an agreement to surrender power. They have to understand that it doesn’t just endanger stability in Greece but in Europe as a whole,” he said.

“When you have absurd demands that go beyond what has been agreed they bring us back to the vicious circle and they don’t help bring solutions.”

On Europe’s refugee crisis, Hollande said during the visit that “Europe cannot leave Greece alone in this.” Despite worsening weather, migrants from Syria, Afghanistan and other countries continue to arrive by boat from Turkey to Greece’s Aegean islands every day.

 

Hollande was accompanied by French business leaders and Finance Minister Michel Sapin, who reportedly worked behind the scenes to help formulate the proposals that led to Greece’s latest bailout.