'Greek deal will damage Euro 'brand'' - Sant

MEP Alfred Sant said the deal reached between the eurozone and Greece will likely cause quite significant long-term damage to the euro "brand". 

When reacting to the latest developments on the issue in Brussels, Sant said that the eurozone governments seem to have succeeded in maintining internal coherence between them, even if only on the surface, and to sustain the dogma that euro membership is irreversible, while holding onto their pound of flesh.

Sant said in Brussels that if the agreement is rolled on, Eurozone states will have carried forward a huge non performing loan on their balance sheet with no need at present to write it down. However, the likelihood is that the problem will recur not too far into the future.

"For this reason, I have huge doubts as to whether the agreement makes technical sense for all concerned, and whether it will make economic and social sense for Greece. It will certainly cause political turmoil there.

"The humiliating way by which Greece has effectively ceded a substantial part of its sovereignty to its "partners" might in other days, have provoked a military coup. I am told however that the Greek army today no longer subscribes to the view that it is the ultimate bastion of national dignity when the political class fails to deliver."

Sant said that Greece is being forced to carry out too many radical initiatives too fast - "I cannot see that the public administrative machine or the private sector will be up to it. This has got nothing to do with trust. In economic terms, the neo-liberal prescriptions that are being forced through are unlikely to deliver jobs in the short to medium term." 

Sant said that this has been the lesson of Portugal and Ireland. In fact, given the privatisation deadlines that are being set, the risks of carpet bagging are bound to grow. "Meanwhile social strains will also grow since once again, it will be the middle to lower income strata of the Greek population which will bear the load," said Sant.