Greek Finance Minister Yanis Varoufakis said Wednesday his country would struggle to meet payments outlined in this week’s agreements with European lenders, according to Reuters. Greece’s new anti-austerity leadership and its lenders agreed to a four-month extension of its loans Tuesday, but those involved in negotiations voiced concern Wednesday about whether the agreement would hold up.
“We will not have liquidity problems for the public sector,” said Varoufakis. “But we will definitely have problems in making debt payments to the IMF now and to the ECB in July.” Varoufakis and his Greek colleagues agreed to pay their creditors $25.4 billion in 2015 provided that the program holds through the end of the year. The current agreement gives Greece a four-month extension of its loans, during which negotiators will continue to hammer out a lasting deal.
Negotiators on both sides, including Varoufakis, have acknowledged that the four-month extension is seen as a trial period to regain trust between negotiating parties. Varoufakis’ German counterpart, Wolfgang Schaeuble, told SWR2 radio Wednesday that “there’s a lot of doubt in Germany” that Greece would follow through with its promises.
Some officials with the European Council, the European Central Bank and the International Monetary Fund, Greece’s three creditors known collectively as the Troika, have voiced concerns that Greece would be able to live up to the concessions it agreed to in Brussels on Tuesday, which were exacerbated on Wednesday as some Greek politicians openly criticized those concessions.
The first cracks in the Greece-Europe agreement came when Panagiotis Lafazanis, Greece's energy minister, said he would stop the privatization of the Public Power Corporation of Greece and ADIME, a power grid operator, which was already underway and promised by Varoufakis on Monday, according to Fortune.
The Athens Stock Exchange jumped Tuesday after the agreement in Brussels was made public, but dropped 1.59 percent Wednesday.