Debt-laden Greece prepares 'Spartan' EU presidency to burnish image

By Harry Papachristou

ATHENS (Reuters) - Barely 18 months after it almost crashed out of the euro zone, Greece takes over the rotating presidency of the European Union with the hope of using the podium to show it is bouncing back.

Greece, which takes on the job for six months from January 1, has a reputation for being the Europe's biggest problem child and will be negotiating for debt relief from other European states while it holds the presidency.

The position requires the holder to organise hundreds of ministerial gatherings and policy negotiations, giving Athens an opportunity to drive the agenda, if only for a few months.

Ireland won rave reviews for running a tight ship during the first half of 2013, even while under an EU bailout, and Denmark bolstered its standing among its peers by efficiently steering the union through the rocky months of early 2012.

For Greece, whose fortunes have revived somewhat since nearly going bankrupt last year, the presidency offers an opportunity and a challenge: a chance to show the EU it is back on track and can deliver a well-organised, slick performance, and the risk of ever more scathing criticism if it does not.

As it lobbies for the relief which economists say it needs if its debts are ever to be made sustainable, the presidency offers Athens opportunity to work closely with Germany, France and other major countries and show that it is a serious player deserving of a break.

"Image matters," said Panos Carvounis, head of the European Commission's office in Athens. "The presidency will prove that Greece has a distinct and important role to play and that it is not a country heading for bankruptcy."

The presidency will also give government officials from across Europe the opportunity to visit Athens and check on Greece's progress with their own eyes, Carvounis said.

"Two years ago, nobody was setting foot here," he said.

"FOLD"

Some Greeks feel their government ought to pass up the opportunity to focus on its own problems - a six-year recession, record unemployment and rising poverty levels.

"In a card game one can also say 'fold' ... we can't do the presidency," said Yannis Boutaris, outspoken left-leaning mayor of Greece's second-biggest city Thessaloniki.

Boutaris said he was "depressed" at Greece's lack of clout in the EU.

Drawn-out haggling between Athens and its EU and IMF lenders over its latest, protracted bailout review - which is not expected to conclude before the start of the presidency - have added fuel to the reformist mayor's scepticism.

One Greek official involved in the preparations complained about Brussels officials trying to set the agenda of meetings next year without checking with their Greek counterparts.

"We are constantly blackmailed over the most simple things such as setting schedules," said deputy Parliament Speaker Yannis Tragakis.

EU officials say the presidency diary always undergoes a large number of changes as the demands of each of the 28 member states and officials in Brussels are incorporated into the schedule.

Ultimately, Athens has limited scope to use the presidency as a tool to promote its own interests. The presidency's role as agenda-setter for EU policies has starkly diminished since 2009, when Brussels created a new post of European Council President held by Herman van Rompuy.

The debt crisis, Greece's most burning problem, falls outside the remit of the presidency because it is handled by the euro zone club of nations sharing Europe's single currency.

NO FRILLS BUDGET

Greece's presidency budget will be squeezed by austerity. Athens has set aside 50 million euros ($68.9 million) to play EU host, in what it promises will be a "Spartan" operation.

"This is the smallest amount spent by any presidency over the past five to six years," Deputy Foreign Minister Dimitris Kourkoulas said. Ireland spent 60 million euros on its presidency earlier this year.

EU commissioners visiting the Greek capital on presidency business next month will pay for their rooms out of their own budgets. All meetings are to take place in Athens.

"There will be fewer and more austere meetings and no junkets up-and-down the country," Carvounis said.

A Greek official heading the preparations was relieved of his duties in October, days after he launched a tender to spend 147,600 euros ($203,100) on presidency ties and scarves.

Both Prime Minister Antonis Samaras and his anti-bailout opposition rival, Alexis Tsipras, are hoping to capitalize on the EU presidency as they prepare for European elections in May that are being cast as a referendum on European austerity.

Samaras has promised to use the presidency to push for more effective EU immigration policies, a major issue in Greece where the far-right Golden Dawn party has grown in power.

Tsipras, who was confirmed as the European Left Party's candidate for chief of the European Commission, is hoping the presidency will allow him to raise his profile.

"This is a presidency which I believe will be the swansong of the Greek tragedy but will also signal a great, hopeful change as it ends ... since the EU elections will take place," Tsipras said. "The message we want to send is that austerity can be defeated in Greece and the rest of Europe." ($1 = 0.7261 euros)

(Additional reporting by Luke Baker in Brussels, editing by Deepa Babington)