Plan B: Varoufakis admits parallel payment system plans

Former Greek finance minister Yanis Varoufakis says had ‘green light’ to look for parallel payment system plan

Photo by: Reuters
Photo by: Reuters

Former Greek finance minister Yanis Varoufakis had admitted that he composed a team through which a parallel payment system plan would be able to switch payments from euro to Greece’s old currency, drachma.

According to the Telegraph, Varoufakis was planning “the Plan B” for some months before his resignation, in case negotiation with the creditors go to an opposite direction.

The planning transcripts were leaked to local newspaper Kathimerini showing the detailed planning of the project.

The former minister stated that the project was approved by Prime Minister Alexis Tsipras.

"The prime minister, before we won the election in January, had given me the green light to come up with a Plan B. And I assembled a very able team, a small team as it had to be because that had to be kept completely under wraps for obvious reasons," he said.

The drastic measure planned, indicates exactly how close Greece was to run out of euro liquidity which partially happened after a referendum was held and banks were closed for three weeks holding a 60 euros withdraw limit.

The quickly created parallel system would be accomplished through hacking the systems of the Finance Ministry allowing them to make transfers at “the touch of a button,” says Varoufakis.

Moreover, Varoufakis hired a friend of his from Columbia University to carry out the plan as they needed access to tax numbers. "We decided to hack into my ministry’s own software programme," said Varoufakis.

He also stressed out that the plan was considered for euro, without excluding the possibility of the new drachma currency.

"This was very well developed. Very soon we could have extended it, using apps on smartphones, and it could become a functioning parallel system. Of course this would be euro denominated but at the drop of a hat it could be converted to a new drachma,” he stated.

Varoufakis admits the plan through a call that was published on The Official Monetary and Financial Institutions Forum (OMFIF) earlier today, under the minister’s permission.

According to the Telegraph Varoufakis said Greek press twisted some reports to make him look in a certain way.

“The context of all this is that they want to present me as a rogue finance minister, and have me indicted for treason. It is all part of an attempt to annul the first five months of this government and put it in the dustbin of history," he said.

"It totally distorts my purpose for wanting parallel liquidity. I have always been completely against dismantling the euro because we never know what dark forces that might unleash in Europe," he added.

The ex-minister continues by stating that an official permission by Europe could not be asked because Troika could retaliate if Greece had a way out of the measures.

"I always told Tsipras that it will not be plain sailing but this is the price you have to pay for liberty," he told the Telegraph.

"But when the time came he realised that it was just too difficult. I don't know when he reached that decision. I only learned explicitly on the night of the referendum, and that is why I offered to resign," Varoufakis added.

At the same time, American economist James Kenneth Galbraith, admitting he was managing the team, supports the plan saying that the project was relying on euro and it was not planned for the drachma currency.

TRTWorld and agencies