The “Men in Black” of the Troika are edging towards a divorce. Three years after it was formed outside of any legal framework provided by the European treaties, this body with three chiefs meant to steer the reform programmes for Eurozone countries threatened with bankruptcy, is riven by tension. The strife has sparked a debate in Brussels on what comes after the troika.
Established during the “rescue” of Greece in May 2010, the unpopular troika is now working with the governments of three Eurozone member states, Portugal, Ireland and Cyprus. It’s the troika that sets out the list of cuts, structural reforms and other privatisations that a country must commit to if it wants, in exchange, a mega-loan to stave off default. The IMF also provides advice to the European Council on reforming the Spanish banking sector.
In three years, this structure with its opaque inner workings has come to symbolise an authoritarian management of the crisis that has pushed Eurozone capitals to the wall, and forced them to push through reforms rejected by many of their citizens in order to stave off bankruptcy.
Logically, this troika will dissolve once the bailouts are finalised – by 2016 for Cyprus, according to the official deadlines. The problem: on the ground, the [recovery] still seems fragile (Ireland), or downright non-existent (Greece). Other mega-loans may still turn out to be necessary and will keep up the torment. This weekend the Europeans and the IMF are to meet in Washington to discuss a new aid package to Greece.
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