The Greek Government Turns To East For Help

Steven Petrov

The Paw Print

The official spokesperson for the Russian president, Dmitry Peskov, has officially stated that as of now there hasn’t been any contractual agreement reached with Greece on the possibility for financial help from Russia in the range of 3-5 billion euros. However, he explained that any assistance in this size will come as a parameter of the “Turkish natural gas pipeline” project, which will use some of the Greek territory for building part of the project.

The official meeting between the newly elected prime minister of Greece, Alexis Tsipras, and the Russian President, Vladimir Putin, took place on April 8^th. The radical leftist party, Syriza, won the elections in Greece in the beginning of 2015 and has ever since expressed its willingness to break any economic and political relationships with the European Union. The country has received two major bailout programs from the European Commission, the International Monetary Fund, and the European Central Bank in the last 10 years and currently owes billions upon billions of euros to these institutions. The major problem is that the debt levels are amounting to over 150% of the country’s GDP, which makes it seemingly impossible for Greece to pay them off. Instead of trying to work closer with the EU officials, who have been extremely lenient in modifying and extending any repayment deadlines, Tsipras and the new Syriza government have been really aggressive in the negotiating process and unacceptable of the various policy reformations that EU has suggested.

The Greek economy is extremely weak, however, and Tsipras is well aware of the fact that he will need serious financial help in order to try to stabilize the economy. This is the primary reason why the Greek Prime Minister has turned towards seeking any potential help from Russia, in the form of “subsidy” for Greece’s participation in the geopolitically and economically important “Turkish natural gas pipeline” project. The parameters for a potential deal included the loan for 3-5 billion euros for the Greek government if an agreement is reached for it to participate in the project, by allowing part of it to pass through Greek territory. Even though such an agreement was not reached in the first meeting, on April 8^th, Greece is expected to sign an agreement with Russia in developing further economic ties in the energy area sometime this week. This will be an indication that the two countries are getting closer to reaching an actual agreement on the hugely important natural gas pipeline project.

According to “Spiegel Online,” which is a German media website, the money that will possibly be transferred from Russia to Greece, will represent the future earnings that Greece will accumulate from taxation of the transition of gas through its territory. There is still room for uncertainty around the deal, but the general terms have already been laid out, so we will be watching closely the further development of the situation.