Tsipras reshuffles negotiating team to sideline Varoufakis

Alexis Tsipras, the Greek prime minister, reshuffled his team of bailout negotiators on Monday, sidelining his outspoken finance minister Yanis Varoufakis after three months of fruitless talks with international creditors, while promoting two low-profile UK-trained economists to key positions.

The premier's move followed a testy meeting of eurogroup finance ministers in Riga last Friday, at which Mr Varoufakis was accused of "time-wasting" over the finalising an interim agreement with the commission and the International Monetary Fund to unlock €7.2bn of bailout aid frozen since last year.

The shake-up signals that Mr Tsipras may be preparing to make concessions to creditors as Greece struggles to raise €1bn to pay pensions and subsidies this month and repay loan and interest of €880m to the IMF by mid-May.

"This is a positive development for the likelihood of a deal," said Mujtaba Rahman of risk analysts Eurasia Group.

"Varoufakis has become the single biggest impediment to a Greek deal. His relationship with Tsipras and Tsipras's willingness to cut him loose has been the central question investors have been focused on," he added.

A government official said the finance minister would head a new "political negotiating team" and would remain "in the frame of collective decision-making and execution" by the leftwing Syriza-led government.

But Euclid Tsakalotos, deputy foreign minister for economic affairs, was appointed co-ordinator of the new team, in effect curbing Mr Varoufakis's role. An Oxford-trained economist and Syriza's shadow finance minister, he was passed over for the top job when Syriza came to power at the January election.

George Chouliarakis, who returned from teaching at Manchester University in the UK to head the finance ministry's council of economic experts, will handle day-to-day bailout negotiations in Brussels.

He is seen as more moderate than his predecessor Nikos Theocarakis, a colleague of Mr Varoufakis who faced accusations by EU officials of foot-dragging in the negotiations.

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