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Creditors concerned over party appointments in the public sector

19 January 2016 / 13:01:37  GRReporter
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European officials expressed creditors’ concern over party appointments in the Greek public sector, warning that this government tactics could put at risk the implementation of the third bailout. In a statement for the Greek newspaper Kathimerini, one of them states, "I am concerned that the way of governing could have a negative impact on how financial markets look at Greece and over its potential return to them. This may affect the monitoring of the implementation of commitments, which should start at some point in January."

Creditors’ concerns are the result of a series of publications, according to which the government of SYRIZA and Independent Greeks is appointing en masse "their people" in public administration. Significantly, almost all family members of SYRIZA's secretary have been appointed as advisers or special assistants to ministers. The same applies to the daughter of Independent Greeks MP and spokesman Marina Chrisoveloni, who is part of Panos Kammenos’ team at the Ministry of Defence and many others.

Party appointments in the public sector are not a new phenomenon in Greece and Brussels is well aware of them based on its experience with former Greek governments. The most recent case of opposition to this vicious practice on the part of creditors was related to the resignation of Revenue Secretary Harris Teoharis in June 2014. However, today’s Greek government began to appoint more quickly and on a much wider scale than previous governments, probably because SYRIZA has never governed before, reads Kathimerini.

The actions of the Greek cabinet have apparently attracted the attention not only of creditor representatives but also of the representatives of EU member countries that are following the events in Athens. A European representative cites as an example the dismissals of dozens of members of the managements of state hospitals with the words: "60 out of 72 people were forced to leave."

According to creditors, the main problem with the appointments based on a party criterion is their direct effects on investment and on the long-term development of the Greek economy. According to their representatives, foreign investors are increasingly worried about the negative investment environment that the Greek government is creating. "If the government believes that the country could do without foreign investment, the cost of this error could be very high," a source from Brussels told Kathimerini. "If universities and hospitals are run by people who are appointed on the basis of political friendships, the result will be a poor level of education and health. All this is negative for the long-term development," he said, stressing that these practices are intensifying "brain drain" from Greece.

The current Greek government forced recent Revenue Secretary Katerina Savaidou to resign. A few days ago, the managing director of Eurobank Panagiotis Tomopoulos also resigned and this alarmed the creditors, as the bank has recently been recapitalised with money from the European Stability Mechanism. The foreign bank shareholders also reacted to this development.

For his part, Greek Minister of Finance Efklidis Tsakalotos said in response to a question about the appointments that "the government is using new selection processes," adding that institutions are provided with greater independence than in the past. Tsakalotos said that the government "has a new policy" in banks and other institutions. "This is the fine line," the Minister said.

Tags: PoliticsCreditorsParty appointmentsGreek public sector Greek banksThird bailoutForeign investors
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