Key errors in the Greek negotiating strategy

Published: Feb 19 , 2015
Author: Yannis Dimarakis

As these lines are written, the negotiations between the Greek government and its Eurogroup partners are still under way. As the end result is not yet known (and probably will not be for some days) some mistakes of the Greek handling of the situation are already discernible. Here are three obvious mistakes I have selected to discuss in this article.

From the first hours of taking office, the Greek government adopted an adversarial tone for its dealings with the Eurogroup and specific key individuals. Indicatively, during a meeting with Jeroen Dijsselbloem only 4 days after the Greek elections, Yanis Varoufakis proceeded to make a public statement, bordering to an insult for the work Dijsselbloem had done with the previous government. On a different occasion only last week, the daily newspaper “Avgi”, considered to be the “official” government paper, published a sketch depicting Wolfgang Schauble in Nazi uniform. Alexis Tsipras tried to apologize a few days later, but the damage was already done. There are more such examples, but the above two are illustrative.

Any seasoned negotiator knows that in the run up of a challenging negotiation, one needs to keep the channels of communication as wide open as possible. A co-operative style increases the chances of this happening, in contrast to an adversarial stance, which is bound to irritate the other side.

Having gained momentum from his European tour, Varoufakis was silently given the opportunity to present his proposal to his colleagues in the Eurogroup last Wednesday (11th February). In the meeting itself, whilst all his counterparts were eager to listen to what the Greek proposal was, moving forward, Varoufakis lectured them on the macroeconomics of the EU. Understandably, this was a short meeting. At that point, Greece missed opportunity No. 1. This was to set the agenda and move an unfavorable Power Balance, by making a credible, realistic proposal.

Having (not) done that, the very next day, the Greek PM could follow up to gain momentum among his European peers during the European Council meeting. Not having a proposal to back, his participation was exhausted in polite introductions to other heads of government. Opportunity No. 2 missed.

This Monday (16th February) another Eurogroup meeting was held. Varoufakis delivered yet one more lecture, whilst no Greek written proposal was in sight. This void was covered by Dijsselbloem, who put forward a document (i.e. a proposal), that was (no wonder) nowhere close to Greek expectations. Another predictably short meeting was under way, leaving Varoufakis explaining that, in fact there was another document drafted by Mr. Moscovici (the Commissioner for Finance), that he was willing to sign... Opportunity No.3 also missed.

Consuming valuable negotiation time with extensive arguments and theory (no matter how interesting), will not take the process far. In contrast, making realistic, valid proposals is bound to move the process forward and create fertile ground on which to build a negotiation.

After the Eurogroup meeting of February 16th, the prevailing impression was (and still is) one of stalemate. A deadlock is always in favor of one side: The strongest. An agreement is instrumental for Greece’s effort to regain control of its finances. Admittedly, Greece is the weak side in this negotiation. In order to avoid this deadlock, Greece should keep the dialogue alive, by making proposals (as described above), conceding on issues of lesser importance, referring the negotiation to a higher level (Yannis Dragassakis, the Deputy PM being an obvious alternative) or introducing new parameters for discussion.

The weakest party should avoid a deadlock. There are specific tools and tactics that can be employed, in order to serve this objective. 

Yannis Dimarakis
Managing Partner, Scotwork Hellas 


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