Tsipras visit to Moscow brings scant relief for Greece

By bne IntelliNews April 9, 2015

Nick Allen in Berlin -


Greek Prime Minister Alexis Tsipras stepped up his debt-stricken country’s new courtship of Russia at top-level talks in Moscow on April 9, but appeared to end his two-day visit empty-handed - apart from an icon returned to Greece 70 years after the Nazis stole it in WWII.

Rich in goodwill but low on immediate tangible results for Greece, was the consensus view on Tsipras’ trip, as his government wrestles with its huge debt burden and tense relations with EU partners. Tsipras met President Vladimir Putin and his counterpart Dmitry Medvedev for wide-ranging talks, but no direct financial support was discussed or offered, at least not publicly.

"The Greek side has not addressed us with any requests for aid," Putin said on April 8. "We discussed cooperation in various sectors of the economy, including the possibility of developing major energy projects," he told a joint press conference, also naming "ports, airports, and pipelines" as attractive for Russian investments.

Gas talks hiss backstage

The leaders also reportedly reached no concrete agreements on Greece's participation in the mulled Turkish Stream pipeline project, which would run from Russia under the Black Sea to Turkey and eventually feed some 63 billion cubic metres of natural gas into Turkey's pipeline network headed towards Europe.

Greece hopes to provide an extension to Turkish Stream through its territory and on to Italy and is said to be seeking a discount of around 10% on Russian gas supplies. Sources close to the talks told Reuters that Greece could make around €500mn a year in profits from such a role.

Turkish Stream was proposed by Putin in December during his state visit to Turkey, and is intended to replace the cancelled South Stream project.

Moscow may possibly give Greece a prepayment of funds based on future profits earned from shipping gas to Europe, two Greek government sources told the agency. Before Tsipras’ visit, the Kommersant business daily also cited a Russian government source who said Greece may get a discount on gas deliveries and new loans in exchange for access to unspecified assets. 
But none of this translates into the huge sums of money Athens needs now to avoid defaulting on its international debts.

Iconic visit of sorts

The Greek prime minister's Moscow visit had caused unease among EU partners that Greece might break ranks over economic sanctions on Russia in exchange for aid. Earlier, European Parliament President Martin Schulz warned against undermining common EU policy towards Russia. 

The union was entitled to "demand solidarity and guarantees that solidarity should not be discontinued as a result of unilateral deviation from common action," Schulz told German media. "This is what he [Tsipras] should be guided by in Moscow. The European Union expects this of him as the head of government of one of the EU member-countries."

Tsipras responded by saying: "Greece is a sovereign country with an unquestionable right to implement a multi-dimensional foreign policy and exploit its geopolitical role."

For his part, Putin said Russia was not trying to drive a wedge between EU members to better its overall position.

"I want to assure you that we do not aim to use any internal European Union situations to improve ties with the European bloc as a whole. We want to work with the whole of united Europe," said Putin,

However, some observers say the Russian leader's intention to be the exact opposite. "The game plan of Putin is to break Western institutions, especially the EU and NATO," Joerg Forbrig, a senior programme director at the German Marshall Fund in Berlin, told Bloomberg. "Russia sees Europe as weak and indecisive."

Meanwhile, Putin lent the occasion some symbolic solidarity with Greece amid its EU wrangles by handing over to Tsipras a stolen Orthodox icon. Seized from a Greek Church by Nazi troops during the war and taken to Germany, the piece was later recovered by the Red Army, Kremlin spokesman Dmitry Peskov said.

Roll out the metaphors

Greece is struggling to meet huge load repayments that are due now. Greece on April 8 was able to sell €1.13bn in six-month Treasury bills to keep itself afloat, while another repayment of €450mn to the IMF loomed the following day, as well as monthly payments of €1.5bn for pensions and salaries. Greece must also roll over another €1bn in short-term debt on April 15.

Wooing Moscow could be one possibility to generate credits at this critical time, and the hope was reflected by the Greek leader's ample use of metaphor-laden images. After previously calling Western sanctions against Russia a "road to nowhere", Tsipras told Putin these were no less than "economic war". He also promoted Greece’s potential as “a link and a bridge between the West and Russia" - despite the frozen state of relations with Russia in the past year.  

"I do not know if this is like the Siberian winter, but this was winter and now we are having spring and we should support this spring for the real development of our relations," he said in comments reported by news agencies.

Russia was Greece's top trading partner in 2013, with a two-way exchange of almost $10bn mainly due to imports of Russian natural gas before last year's political upheavals brought a 40% slump in trade.

But if Tsipras had at least hoped to talk up a Greek exclusion from the Russian ban on EU food products, he was disappointed: Putin ruled out any exception during their meeting. Athens had written to the Russian authorities asking them to drop import restrictions for a number of Greek food products, such as strawberries, kiwi fruits, peaches, fish and seafood.

Deutsche Welle commentator Barabar Wesel said if anything, the visit has backfired, and noted that "the Greek prime minister has to sit at the negotiating table in the next two weeks with the same people he has incensed by his trip to Moscow". 

Tsipras maintained a proud front, nonetheless: "Greece is not a beggar going around to countries asking them to solve its economic problem, an economic crisis that doesn't only concern Greece but is a European crisis," he said.

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