Greece And Russia Sign Deal On Turkish Stream In The Mist Of The Greek Debt Crisis

On June 2nd, EMerging Equity reported that Greece was planning to sign a document on political support for Gazprom’s Turkish Stream project at the St. Petersburg International Economic Forum. Surprisingly, while struggling with its debt, Greece wanted to allocate $2 billion to support its construction. And … it happened. Russia and Greece have signed a deal to create a joint enterprise for construction of the Turkish Stream pipeline across Greek territory, according to Russian Energy Minister Aleksandr Novak. The capacity of the pipeline will be around 47 billion cubic meters a year.

Construction of the Greek section of the Turkish Stream pipeline will start in 2016 and be completed by 2019. The two countries will have equal shares in the company, Novak said at the St. Petersburg Economic Forum on Friday according to RT.

Construction of the pipeline in Greece will be financed by Russia. Athens will return the money afterward, Novak added.

“Our meeting today is a historical meeting… The memorandum expresses the readiness of both sides to bring the southern direction of the pipeline to implementation,” Greek Energy Minister Panagiotis Lafazanis said.

Greece has been struggling to make a deal with its creditors and is likely to leave the Eurozone and the EU if it fails to reach an agreement to unlock a €7.2 billion bailout installment.

“Failure to reach an agreement would, …, mark the beginning of a painful course that would lead initially to a Greek default and ultimately to the country’s exit from the euro area and – most likely – from the European Union,” the Bank of Greece said in a statement Wednesday.

The Greek Drama continues and on the opposite note, Prime Minister Tsipras surprised investors on Friday and said that “there will be a solution to the Greek debt crisis that will allow the country to return to growth while staying in the Eurozone.“

According to Seeking Alpha, “The statement was strikingly upbeat given the tone at yesterday’s Eurogroup meeting. Greek Finance Minister Yanis Varoufakis proclaimed that the eurozone was dangerously close to accepting an “accident,” and an emergency summit was planned for Monday (…) Some also expect Greek banks not to open next week, after savers withdrew €2B over the past three days.“

Things do not look good neither to Greece nor to the EU. Also let’s not forget Greece is a NATO member and the country has started a dangerous geopolitical game by signing the Turkish Stream deal with Russia. Short term it may look great to Greek people, however long term consequences could be very serious as they will only play in Russia’s favour and its expansionary ambitions and vision.

Just today, The Independent has reported the following:

“Greece is dangling the prospect of an Athens-Moscow alliance in an audacious attempt to pressure its eurozone creditors into watering down austerity demands as the country teeters on the edge of default and bankruptcy.