This is not a bailout

Reforms helping Greece might hurt Syriza

The reforms tick some of the favoured boxes of hawks in Germany and elsewhere. But Syriza's election pledges to end the bailout and reverse austerity are in tatters. Europe may be better off - but the domestic situation in Greece has become more volatile.

The list follows a February 20 agreement by Eurozone finance ministers to let Athens outline its own reform programme. That was seen as a prelude to the release of funds by Greece's creditors and the negotiation of a third bailout. Yet it looked hard to reconcile the Eurozone's demands that Greece adhere to previous bailout conditions with Prime Minister Alexis Tsipras' election promises to end austerity and reverse reforms.

Greece now pledges to tackle its inefficient public sector and clamp down on tax evasion. But the programme is most notable for what is not in it - most of Tsipras' former promises. Greece has committed not to halt privatisations. It also implicitly pledged not to reverse labour reform, instead saying that laws would stay in line with European Union "best practice," and that increases of the minimum wage wouldn't damage Greece's competitiveness. The agenda contains much of the plan agreed to by past governments, such as streamlining pensions or bolstering the country's fiscal watchdog.

European creditors could find fault with a lot of what has been pledged. The proposals are still vague. Promises such as clamping down on smuggling are easy to talk about, but hardly new. There is also the question of how much Tsipras can actually achieve. He needs to show tangible progress by April for the Eurozone to release some euro 7 billion of aid. It's still not clear how Greece can fund itself in the meantime.

The Greek proposals have received lukewarm response from the International Monetary Fund and the European Central Bank. Yet Eurozone governments and their national parliaments would do well to sanction Tsipras' agenda. For one, visible evidence of a U-turn will dampen support for populist parties in Europe. Second, the move may hasten a restructuring of Greek politics, if Tsipras breaks with his party's hardliners and forms a more centrist government. The road ahead is likely to be rocky, but Europe should stick with the Greek PM.