Rutte: 'een onverdeeld en volledig gecommitteerd Griekenland laten we niet in de steek' (en)
EUOBSERVER / BRUSSELS - EU leaders are expected to back a European Commission proposal to unlock €1 billion in European funds to Greece as a carrot for the embattled country alongside the stick of imposed austerity.
Athens will not be "abandoned" if it does its part and push through a massive austerity and privatisation programme and achieve national unity, European chiefs said on Thursday (23 June)
Sources close to the discussions on the matter at a summit of the bloc's 27 leaders say that heads of state and government are happy to endorse the proposal, which would see no new money offered to Greece, but rather accelerate the release of unspent money.
A declaration by the EU's premiers and presidents later tonight addressing the Greek situation will endorse the initiative, first suggested on Tuesday by European Commission President Jose Manuel Barroso i.
Only 25 percent of the country's allotted €20 billion in EU cash, from a variety of sources including structural funds, the EU Social Fund and technical assistance money, over the seven-year period from 2007-2013 has been spent.
"The problem has been a lack of absorption capacity," said commission spokesman Mark Grey, noting that Greece has one of the lowest rates of use of the Social Fund in particular in the Union.
He said that commission officials from DG i Regio i, the regional development department, are already in contact with Greek officials working to boost administrative capacity.
"They're not trained properly. They can't realise projects," he continued.
Keen to be seen to be offering something positive to Greece amid growing civic unrest and widespread opposition to the EU-IMF-ECB-imposed austerity and privatisation measures, officials highlighted how the Social Fund is the bloc's main financial instrument for combatting unemployment particularly amongst the young and poorly trained.
"We are trying to illustrate how very quickly we are reacting in this crisis situation, not just on the so-called mean side," Grey added. "It's a double message: If you act, we will help."
"The billion sum is largely symbolic. We're actually being quite conservative here - it could and, if the absorption capacity is boosted, it should be bigger. Money is not the issue - it's the ability of the country to put it to use."
One hiccup in the plan is that some funds require matching money from the host government. With Greece essentially insolvent, there is little money that can be put up. Legislation could be considered to relax or change these rules, but this would take some time.
Mark Rutte i , the Dutch prime minister, meanwhile again stressed the need for national unity, even as Greek conservative opposition leader Antonis Samaras repeated his opposition to the midterm austerity plan amounting to €28 billion in cuts.
"The current policy mix implemented by the Socialist government calls for more taxes to an economy under unprecedented pressure," he told reporters in Brussels.
"This has created obvious problems as demonstrated by all current figures. We need corrective measures so as to ensure that the Greek economy recovers and pays back its debt."
European leaders reacted by repeating their demand that national unity be achieved.
"Today we ask the leaders and citizens of Greece to rise to the occasion and do what must be done. It is going to be difficult and painful, but it's the only way out of this crisis. A nation undivided, focussed and fully committed will not be abandoned," said Dutch Prime Minister Mark Rutte.
An EU official told EUobserver that such a national accord is necessary: "Look, this crisis is not about to be solved in one or two years. The thinking behind the demand for national unity is that no matter if the government changes, the country remains tied to the programme."
The summit's Greece declaration will also include "almost identical language" to the ultimatum made to the country on Monday by eurozone i finance ministers that Athens must push through its austerity and privatisation package in order to receive its fifth tranche of bail-out cash, worth some €12 billion.
The declaration will also salute the "good progress" fellow bail-out countries, Portugal and Ireland i, are achieving in delivering on their own austerity programmes.