Greek Prime Minister Alexis Tsipras on Monday reshuffled his team handling talks with European and IMF lenders, a move widely seen as an effort to relegate embattled Finance Minister Yanis Varoufakis to a less active role in negotiations.
An anti-austerity economist who has angered peers with his brash style, Varoufakis is facing calls to quit after returning from a meeting of euro zone finance ministers in Riga isolated and empty-handed while Athens scrambles to avoid bankruptcy.
Deputy Foreign Minister Euclid Tsakalotos – a close Tsipras ally and soft-spoken economist liked by officials representing creditors – was appointed coordinator of the group, the official said. This would elevate him from his current position and give him a more active role in the negotiations, pushing Varoufakis to the sidelines.
The latest developments suggested Tsipras was ramping up efforts to ease tensions with lenders and strike a deal to unlock aid so Greece can avoid defaulting on payments, which could force it out of the 19-nation euro zone.
The news spurred a rally in Greek stocks and bonds. Greek two-year bond yields fell 250 basis points to a two-week low of 23.55 percent, reversing an earlier rise. Athens stocks rose 4 percent while Greek bank shares jumped 9 percent.
Later on Monday, the government said it was preparing a bill to legislate reforms already presented to the lenders, in an effort to inject new momentum into the slow negotiations.
Euro zone officials welcomed the reshuffle and the apparent effort to reduce Varoufakis’ role in negotiations with them. “The way he behaved made him an additional obstacle in the negotiations,” said a euro zone official.
Another euro zone official questioned whether the move would bring about the substantive change lenders have been demanding.
Varoufakis was later taken to task by the media after he failed to appear at a state dinner after the meeting. He responded by tweeting a quotation by former U.S. president Franklin Roosevelt which read: “They are unanimous in their hate for me; and I welcome their hatred.”
In another move hinting at a less prominent role for Varoufakis, his general secretary, Nikos Theocharakis, who had been leading technical-level talks with the so-called Brussels Group of lenders, will now focus on drawing up a plan for growth to be the basis for a new deal with lenders in June.
George Chouliarakis, considered close to powerful deputy Prime Minister Yannis Dragasakis, will take over responsibility for talks with the Brussels group.
In an effort to show that Athens is serious about giving lenders access to data, a new team was also set up to support EU and IMF officials gathering information in the Greek capital.
