There has been at least one constant in the long-running drama between the Greek Syriza government and Greece‘s European creditors: Syriza’s refusal to compromise on pension and labor reform. Though the party has been willing to make other concessions—for instance, privatizing a port and leasing out airports—it’s continuing to stick firmly to its guns on pension and labor reform, raising the possibility that negotiations could once again stall. Reuters:
“There should not be an expectation on the part of institutions … that the government will back down on everything,” Gabriel Sakellaridis told a news conference. “When you negotiate, there should be mutual concessions.“We won’t go beyond the limits of our red lines,” he said. “It’s clear that we cannot cut pensions.”
In a move that further signals Syriza’s unwillingness to bend, the government on Thursday rehired around 4,000 employees previously laid off under austerity measures. The move that does not violate bailout terms, but it will not be heartening to EU leaders, who are increasingly thinking the unthinkable on Greece, if not quite yet saying it out loud. When asked about the possibility of a Grexit, Juncker replied, “If I were to say that ‘Grexit’ was an option, what do you think would happen then on the financial markets?” As long as neither side is budging on pension and labor reform, a Grexit will look more and more likely as the May deadline approaches.