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The Greek parliament voted in favor of the proposals handed by Alexis Tsipras. 250  out of 300 voted in favor. This reflects the desire to prevent a Grexit within Greek society.

While only 145 out of his 162 strong coalition supported the proposals, the ball is now fully in the German court to sign off a deal that will include debt structuring. Here’s why:

  • More voices, coming from the IMF, the US government and even Scheauble himself, say that Greece’s debt is  unsustainable. So, this needs to be addressed, be it only  restructuring and not a full haircut that Merkel opposes.
  • Greece approved all the measures. There are no more excuses on this front.
  • Varoufakis blamed  Scheauble for working towards a Grexit. He also described how the head of the Eurogroup, Dutch finance minister Dijesselbloem, basically threatened to close down Greek banks if Greece didn’t bow to its creditors. So far, this was not denied.

Refusing to accept a deal with debt restructuring after Greece gave in on austerity and everybody knows debt relief is needed would prove what Varoufakis says: that  negotiations were never made in good will and that the bailouts were for German and French banks rather than for Greece.

Such action would deter other countries from joining the euro-zone and could also push Britain out of the European Union.

The next moves are an official approval by the Eurogroup and then a stamp at the EU Summit on Sunday. We know about some  hardliners in Merkel’s CDU party that oppose it, as well as some countries which aren’t really happy with a third bailout for Greece.

Yet if  it fails at this point, no matter how, the blame sticks with the German government. Its taxpayers will pay more and they can blame their elected officials in this case, not Greece anymore.

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