Greece's left-wing-led government has laid into its international lenders once again, saying that their bailout methods and disagreements among them is damaging the country's inability to recover.
On Sunday, Greek Prime Minister Alexis Tsipras said that a rift within the so-called troika of the International Monetary Fund (IMF) and European bodies the Commission and European Central Bank over how to deal with Greece's debt burden was damaging the country's recovery.
"I would say that what is creating conditions of delay in regaining trust of markets and investors ... is the constant clash and disagreement between the IMF and European institutions," Tsipras told a news conference in Thessaloniki, Reuters reported.
On the one hand, the IMF has said it would not participate in Greece's third 86 billion euro ($96.8 billion) bailout until the issue of debt sustainability is sorted. Meanwhile, European lenders want Greece to meet numerous conditions of its bailout package before it implements measures to help Greece repay its debts. This assistance could include extending the maturities on Greek loans or even debt forgiveness.
Marica Frangakis, political secretariat and economist for Syriza, which governs in an awkward coalition with the right-wing Independent Greeks party, told CNBC that Greece's lenders had "failed miserably" in their policies aimed at rescuing the Greek economy.
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"These (troika) policies have been emphasizing austerity, that is internal devaluation – that is, reducing the cost of labor as a way of increasing competitiveness and reducing the size of the public sector as a way of reducing fiscal debt and the deficit – now this is a recipe that has been tried many times before by the IMF and failed. They were tried in Latin America and Africa in the 1980s and failed then and even the IMF admits that," she told CNBC Europe's "Squawk Box" Monday.
"But one doesn't learn from one's mistakes so they will repeat it in the case of Greece and they have failed dismally because not only has the Greek economy been in a deep recession since 2010 but also the public debt has been increasing – in other words, you're refinancing your debt and to do that you're getting an even larger amount of loans and in the end you can't repay them and we've ended up in a slump in the last six years."
Aside from the impasse between Europe and the IMF, Greece's bailout has been beleaguered by other delays too with Greece's struggling to implement a host of reforms to its pension, labor and taxation systems as well as spending cuts in order to meet an ambitious primary budget surplus target by 2018, as demanded by international lenders.
'Summer is over'
Tsipras' and Frangakis' comments came after euro zone finance ministers met on Friday to discuss Greece's bailout progress, concluding that the "pressure is back on" and that the country had to "get back to work" on reforms, the head of the Eurogroup, Jeroen Dijsselbloem, said.
"Summer is over. We really need to restart and pick up on the time lost. And the Greek minister, our Greek colleague, was I think convinced there was a joint interest for all of us to keep this on track. It has very much to do with trust, trust of course between us, trust in the IMF… but also trust from the outside world in Greece and the Greek economy," Dijsselbloem said during a press conference after the meeting.
James Nixon, head of Macro Forecasting for EMEA Oxford Economics, told CNBC that it was "difficult" to know who was to blame for the current intransigence between creditors and Greece.
"You have to say that you have a lot of sympathy for the Greeks and for the Greek economy. We're in six-seven years of recession and that's unprecedented for an advanced economy," he said.
"Nevertheless, if you look at the latest spat between Greece and the Eurogroup, only two of the 15 "prior actions" (targets that need to be met to release bailout aid) have actually been completed on time by Greece and those are based around liberalizing the energy market and putting in place new governance for the banking sector and sorting out tax revenues," he said.
"The incredible thing about Greece is that, here we are six or seven years into a program and you just can't believe that we're still arguing over what are really quite basic reforms to the economy."
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