Finnish opposition parties want Greece out of euro
Soini urges Greece to default on some loans, Centre Party suggests major devaluation
The two opposition groups in Parliament, the Centre Party and the Finns Party, support a model in which Greece will leave the eurozone and go back to its own currency, which would then be sharply devalued.
The reduction in the value of a country’s currency in relation to others raises the competitiveness of the country’s exports. Finland used this method in the recession of the 1990s. Joining the common currency, the euro, has ruled out this option.
Finnish government parties did not warm to the proposal put forward by the opposition, as Parliament on Tuesday debated the second support package to be given to Greece, which the eurozone countries agreed on last week.
The package is up for a vote in the Finnish Parliament today, Wednesday.
Pentti Kettunen (Finns Party) lamented that when he was elected to Parliament, he imagined that he would be dealing with matters related to Finns who are less well off. “Here we constantly have to talk about Greek affairs.”
Finns Party chairman Timo Soini said that Greece “must be let out of the euro hangman’s noose”.
“Greece’s only possibility to get back on its feet is to leave some of its debts unpaid and to go back to its old currency”, Soini said.
The Centre Party’s Mauri Pekkarinen said that there is no credible prospect for Greece succeeding in the euro. He recommended a controlled transition out of the euro, combined with a devaluation of 40 to 50 per cent.
Pekkarinen emphasised that even after that Greece will continue to need the support of the IMF and the EU. The Centre Party, which was in the government that approved the first bailout package for Greece, has taken a new and almost diametrically opposed stand on the matter in opposition.
Pekkarinen says that the reason for the change is that Greece has not acted as had been agreed.
The Swedish People’s Party’s Astrid Thors criticised what she called “devaluation romanticism”.
“Have we forgotten who paid for the [Finnish] devaluations? Those with low incomes”, Thors said.
Prime Minister Jyrki Katainen (Nat. Coalition Party) was amazed at Soini’s advice, according to which Greece could be allowed to ignore some of its debts.
Some MPs expressed shock that the Ministry of Finance decided to keep the collateral agreement reached between Finland and Greece a secret.
The English-language version has been available to MPs to read, but only under heavy guard.
“All MPs need to have a genuine possibility to acquaint themselves with documents that are important from the point of view of making decisions, and in their own mother tongues”, said Markus Mustajärvi of the Left Group.
Soini said that the Belgian culture of secrecy has now arrived in Finland.
Previously in HS International Edition:
Finance Minister Urpilainen hopes Greece bailout will be enough (23.2.2012)
Wrangling over second bailout package to Greece continues (16.2.2012)
High price to be paid by Finland for collateral for Greek loan guarantees (5.10.2011)
Timo Soini sharply critical of Finance Ministry´s decision to conceal collateral documents (28.2.2012)