Tsipras given legitimacy to pursue his policy, Milanovic says

Greeks gave legitimacy at Sunday's referendum to the incumbent government to pursue its policy and it is not clear if they will stay in the euro area, Croatian Prime Minister Zoran Milanovic said in Bedekovcina on Monday.

Speaking of the referendum at which Greeks rejected austerity measures demanded by creditors in exchange for financial aid, Milanovic said, "That's more significant for Greece than for the European Union."

He said some things remained unclear. "Will (Greece) stay in the euro area and, if it's ousted, can it stay in the EU?" he asked, adding that "Greeks again gave the incumbent government legitimacy to pursue its policy."

"But other governments, which were also democratically elected, have a say in this, states which went through austerity have a say in this, and the question is how the countries in the euro area would look upon it if looser criteria were now set for Greece," Milanovic said.

"Austerity measures are controversial but it's necessary to find a balance. It seems that Greece hasn't found it. Spaniards saved too, the Irish saved too, and a lot, the Portuguese too, even Italians. In Greece it hasn't worked... The rules are more or less the same," Milanovic said.

"Croatia is economically more stable than Greece. Perhaps we still aren't at their level per capita, but in some industries we have always been stronger than Greece and I believe this will be proved in the years ahead."

He said Croatia should not hurry to enter the euro area "but the system pushes us there... The euro can be neither an excuse nor be blamed. You enter the euro area when you are ready, the criteria are clear."

He sad Croatia's public debt remained too high and that it must not exceed 60 percent. "We'll have to reduce it but we have two years to do it. Even if there was no crisis, we'd have time to adapt to that."

(Hina) ha

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