Holiday mood

The latest "troika" report on Greece was published only shortly before the finance ministers' summit. It was rather mixed. The troika, consisting of the European Union, the International Monetary Fund (IMF), and the European Central Bank (ECB), recognized some progress in Greece's savings and reform efforts, but still saw much room for improvement, particularly in the reform of a bloated bureaucracy and the privatization of state assets.

The latest tranche of EU cash was dependent on this report. Despite the shortfall, the ministers released some 6.8 billion euros ($8.7 billion) of the ongoing bailout funds - though only in installments. Greece still has to complete a tax reform and put thousands of state employees into a transitional staff holding company before it gets any more money.

Delaying doesn't help

Strangely, two particularly stubborn critics showed themselves unusually generous on this balmy summer's evening in Brussels (08.07.2013). German Finance Minister Wolfgang Schäuble said coolly, "It isn't new that things aren't easy in Greece." But, he said, the country had made significant advances. "I am sure that we can continue this difficult but successful path in the coming months."

His Austrian counterpart Maria Fekter was similarly placid. "The economic growth has been better than expected," she said. "Tourism is going up again. And they just have to push through their structural reforms."

It was Fekter who had previously insisted most vehemently on sticking to the exact conditions when Greece failed to deliver reforms on time, or not completely. It was partly her doing that money was often held back until the last minute, just to put extra pressure on Athens. But she seems to have changed her mind. "This delaying policy doesn't help and just makes things more expensive," she said, before hoping that the upcoming break would be calmer. "I don't want to have to come back to Brussels in the summer," the minister said. "It'll be fine if we see each other in the fall again."

Portugalis done

The finance ministers seem to be satisfied that Portugal's government crisis has now been overcome. It was sparked by last week's resignation of Finance Minister Vitor Gaspar, who said he felt that the population was no longer behind the austerity measures. The move immediately prompted an increase in interest rates on Portuguese government bonds. But since then the governing coalition under Prime Minister Pedro Passos Coelho has recovered.

Schäuble played down this danger too. "Government crises within member states happen from time to time," he said, adding that he hadn't been surprised by his counterpart's resignation in Lisbon, though he did regret it. "Portugal has shown extremely stable conditions in the past few years," he said. "That's why I feel relatively relaxed. Portugal must continue its successful path." Portugal's path may be successful in terms of the bailout package, but whether the population will follow it to the end is another matter.

Draghi critical

It was Mario Draghi who ended up raining on the finance ministers' parade. The ECB president did not speak at the same time as the ministers - he was answering questions before the European Parliament's Committee on Economic and Monetary Affairs (ECON). But his message was clearly directed at the ministers.

The biggest problem in Europe, the Italian said, was the recession. "Economic activity in the eurozone has dropped for the sixth quarter in a row," he said. "The situation on the labor market remains weak." Other threats include unexpectedly weak demand and a slow or inadequate implementation of structural reforms. Draghi presented his audience with a whole palette of problems. The message was: No, there is certainly no need to panic - but we shouldn't go overboard with our summer holiday mood.