Athens Digest 17.04.2018

• Flag-planting holidaymakers heat up ‘undeclared war’ with Turkey

• Tax arrears surge amid Tsakalotos admission

• Greece irritated at leaks north of the border

• Snam-Enagas-Fluxys lead bidding for gas grid operator

# Flare-ups in tension have become a near-daily occurrence between Greece and Turkey, often surrounding activity on rocky islets considered by Ankara to be disputed. The latest spat was started by a post on social media, in which a group of three young Greek men _ apparently holidaymakers _ planted flags on rocky outcrops around Farmakonisi in the eastern Aegean Sea. Turkey’s Prime Minister said the coast guard had removed a flag on the islet nearest Turkey, but Greek authorities denied it, and ordered their own search of the area. Yildirim warned that actions considered hostile would be met with the “appropriate response,” while a government spokesman in Athens described his remarks as “provocative and reprehensible.” Prime Minister Alexis Tsipras today is due to visit Greece’s easternmost island, Kastellorizo, traveling with armed forces chief Adm. Evangelos Apostolakis. Fotis Kouvelis, the deputy defence minister, described Turkey’s hostile air-and-sea patrolling in the Aegean as an “undeclared war.”

# Tax arrears saw an unexpected jump in February despite a campaign by authorities to step up confiscations. Unpaid taxes reached EUR1.9 billion in February, nearly double the amount from the previous year. Speaking in Parliament, Finance Minister Euclid Tsakalotos acknowledged the government had been over-optimistic in its assessment of efforts to fight tax evasion, but insisted it had made key structural improvements. Greece was awaiting this week’s official release of the IMF’s World Economic Outlook and related fiscal reports as well as the start of the Fund’s Spring Meetings which could give Athens a better indication of whether key differences with European lenders have narrowed. Reportedly, Tsakalotos is likely to meet with managing director Christine Lagarde on Saturday.

# Nikos Kotzias, the foreign minister, expressed his irritation with officials in Skopje for revealing details of the ongoing name negotiations to the news media. “The leadership of that country should understand that they cannot conduct negotiations using press interviews or by making public statements,” Kotzias said in Luxembourg during meetings with EU Foreign Ministers. Zoran Zaev, FYROM’s prime minister, revealed that his country favours adding a geographical qualifier _ Gorna, Severna, or Vardarska, meaning Upper, Northern, or Vardar _ to the name Macedonia. He also said that the two sides remained at odds over Athens’ demand for a constitutional amendment and guarantees that the new name would also be used domestically.

# Privatization agency HDRAF says a consortium made up of Italy’s Snam SpA, Spain’s Enagas Internacional, and Fluxys SA of Belgium has submitted the highest bid for a controlling stake of natural gas grid operator DESFA, in the process seen by creditors as a litmus test for Greece’s commitment to further market reforms. HDRAF said it had asked the consortium to improve the offer. A lower bid for the 66 percent stake of DESFA and was submitted by a consortium composed of Regasificadora del Noroeste SA, Reganosa Asset Investments, Transgaz SA, and the European Bank for Reconstruction and Development.

On Our Radar: Truman still standing
It’s been bombed (twice), pulled down (twice again), and vandalized on numerous occasions, but yesterday the statue of U.S. President Harry S. Truman stayed on its feet after police thwarted the latest attack in central Athens. Communist party-backed students and unions attached ropes to the 3.5-meter bronze statue and began cutting at the ankle with a power saw when riot police dispersed the demonstrators in chaotic clashes that left several injured. The protests were organised in response to airstrikes in Syria. More rallies are planned today. Truman’s statue unveiled in 1963 to thank his administration for post-war financial support and crucial military backing for government forces during the Greek Civil War. The government in the 1980s rejected proposal to replace it with a statue of Abraham Lincoln.