The latest Eurogroup ended with a confrontation between the new greek minister of finance and all the rest. Varoufakis was actually accused of lying, not being prepared, not proposing anything, not committing to anything etc. Given my personal experience with negotiations, I was wondering if this was true or if it was the first rule of negotiations 101: If your opponent has a good negotiator, take him out by discrediting him to the people who mandated him.
The MoF disclosed the documents of the Eurogroup, including the non papers given by Varoufakis and the alternative texts for the Eurogroup communique, all in good english, showing that there was plenty of preparation and that Varoufakis did not lie on the two alternative communique drafts: http://www.naftemporiki.gr/cmsutils/downloadpdf.aspx?id=917523
This has actually proven to me, at least, that the reason for the failure and the subsequent discrediting tactics was the fact that they did not like what he said as it hurt the interests of eurozone companies and mostly German ones for that. Let me pick, inter alia, some things the Greek government committed to do differently that are likely to hurt the interests, existing or hoped for, of companies based in certain Eurogroup countries, including greek interests:
1. They will examine future privatizations on their own merits and not dogmatically
2. They will make procurement transparent
3. They will attack tax evasion/avoidance through transfer pricing for multinationals present in Greece and fuel contraband
4. They will "undermine rent-seeking, in particular in the oil sector, procurement, the construction sector, the financial sector, and the media"
Rent seeking, in economics, means those who exploit market imperfections, usually market positioning, to extract higher profits than in a fairly competitive case, e.g. banks charging 800 basis points to healthy companies for loans.
"I was young and now I m old" and still the greek governments make promises to stop tax evasion and produce high tax collections.
ReplyDeleteThis government claims will collect an extra 5.5 b of euros.If they suceed, we all gonna die.
Also have in mind that inside Syriza many already try to undermine Varoufakis,he might end jobless soon,unless he will be able to present some results.