The European Commission and International Monetary Fund hastened over the weekend to placate debt-hit Greece after the government bristled at a suggestion that it embark on a huge assets sale.
The Commission, the IMF and the European Central Bank, issued a statement expressing 'the deepest respect' for the 'tremendous' fiscal overhaul the government had undertaken.
The three, known as the 'troika' in Greece, are supervising Greece's tough austerity programme and were reacting to a row that blew up on Friday. One of their auditors said the Greek state should sell assets worth €50 billion to reduce its rampant debt. But that is a figure far beyond anything the government had indicated so far.
The joint statement from the troika was clearly designed to pour oil on the troubled waters. Greece's austerity measures were based on 'mutual trust', they said.
'Our three institutions have full respect for the prerogatives and initiatives of the Government in all areas of economic decision-making, and our role is to advise and support the government while considering options during the decision-making process,' they added.
'It is regrettable if a different impression was perceived at any time. We recognise the difficult challenges facing the Greek economy and we have the deepest respect for the tremendous efforts being made by the Greek people. We continue to support those efforts,' they said.
Athens, which last year accepted the supervised reforms in return for a massive rescue loan, had at first seemed to take the sell-off demand in its stride. An unofficial document released by the finance ministry immediately after Friday's joint news conference even said a 'portfolio' of assets worth 'at least €50 billion' would be created to this effect.
But on Saturday morning, as the Greek press and opposition figures savaged the proposal, government spokesman George Petalotis objected that the call amounted to interference in Greek affairs.
Greek Prime Minister George Papandreou on Saturday said he had protested to the International Monetary Fund and the EU over the 'unacceptable behaviour' of the troika representatives.
And on Sunday, Finance Minister George Papaconstantinou turned his fire on the European Commission representative after he repeated calls for the enormous asset sale in statements to two Greek newspapers.
Greece had so far already earmarked several state properties for sale but only planned auctions worth €7 billion over the next three years. It was the first time since Greece's debt rescue in May that the two sides seemed to be at odds over what the next steps of Greek economic recovery should entail.
Greece's public debt stands at around €300 billion after years of large public deficits that in 2009 stood at 15.4% of output, more than five times the allowed EU level.
