Wednesday, July 8, 2015

Greek debt crisis: Athens launches desperate bid for aid with another summit


The European Union's 28 member states will hold a decisive summit on the Greek debt crisis on Sunday after an emergency Eurozone leaders meeting finished without a deal.


Greek prime minister Alexis Tsipras talks with European Central Bank president Mario Draghi at the Eurozone emergency summit.

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Greek prime minister Alexis Tsipras said "the discussion was held in a positive atmosphere".

German chancellor Angela Merkel, also speaking after the summit, said Greece needed a new debt program lasting several years, not a short-term fix to get it through the immediate crisis.

Summit statement
  • We met tonight to discuss the serious situation in Greece. We noted that the euro area authorities stand ready to do whatever is necessary to ensure the financial stability of the euro area as a whole.
  • Following the Greek referendum, Prime Minister Tsipras committed to present a new request for a program within the framework set by the ESM Treaty, including strict policy conditionality.
  • We agreed to urgently examine whether it is possible to establish a basis for finding an agreement that respects existing commitments and our common rules.
  • The Greek government will on Thursday July 9 at the latest set out in detail its proposals for a comprehensive and specific reform agenda for assessment by the three institutions to be presented to the Euro Group.
  • The heads of state or government will meet on Sunday July 12.

"We need a program over several years which goes way beyond the program we discussed 10 days ago" on a bailout extension through to November, she said.

Greece has until Thursday to submit a reform plan for a bailout package.

Mr Tsipras said Athens was seeking a "final exit" from the crisis with a reform-for-aid proposal.

"The Greek side will continue the effort, having the strong weapon of the Greek people's verdict ... the vast majority's will for a viable agreement to end the discussion [about a Grexit] and offer the prospect of finally exiting the crisis."

Ms Merkel said that European Central Bank chief Mario Draghi assured euro zone leaders the ECB would do what is necessary to keep Greek banks afloat until Sunday's summit that will seek a deal on further aid.

The German chancellor said she was "not exaggeratedly optimistic" of a solution to rescue Greece on Sunday, but the summit had been called "because we think the situation is so dangerous".

EU president Donald Tusk said the Greek government had until Thursday at the latest to set out in detail its proposals for a comprehensive and specific agenda.

"Inability to find an agreement may lead to bankruptcy of Greece and insolvency of its banking system," he said.

European Commission head Jean-Claude Juncker said the EU had prepared for every outcome in the Greek debt crisis, including its possible exit from the euro.

"The Commission is ready for everything. We have prepared a Grexit scenario in detail ... a humanitarian scenario, and the scenario of keeping Greece in the Eurozone," he said after the emergency summit.

'Final exit' could play out either way

Mr Tsipras has been engaged in a desperate bid to win fresh aid from sceptical creditors at an emergency Eurozone summit before his country's banks run out of money.

But some of Athens' 18 partners in Europe's common currency vented exasperation at five years of crisis wrangling with Greece.

I have the strong impression there were 18... ministers of finance who felt the urgency of the situation and there is one... who doesn't feel the urgency of the situation.

Belgian finance minister Johan Van Overtveldt

Lithuanian president Dalia Grybauskaite complained: "With the Greek government it is every time manana [tomorrow]."

Ms Merkel, under pressure in Germany to cut Greece loose, made clear it was up to Mr Tsipras to present convincing proposals after Athens spurned tax rises, spending cuts and pension and labour reforms that were on the table before its 240 billion euro ($354 billion) bailout expired last week.

Eurozone finance ministers complained that their new Greek colleague Euclid Tsakalotos, while more courteous than his abrasive predecessor Yanis Varoufakis, had brought no new proposals to a preparatory meeting before the summit.

"I have the strong impression there were 18 ... ministers of finance who felt the urgency of the situation and there is one ... who doesn't feel the urgency of the situation," Belgian finance minister Johan Van Overtveldt said.

Maltese prime minister Joseph Muscat said that Greece had not come up with a "concrete proposal".

"The absence of a concrete proposal by Greece government doesn't help this evening's Eurozone leaders' meeting," Mr Muscat wrote on Twitter.

But Mr Tsakalotos said there had been "progress" in meetings with his counterparts and there was "political will to give Greece a new chance".

Asked why he had not brought a new set of Greek bailout reform proposals for the finance minister talks, he said it was "more complicated than that".

Greece request 'taking into account' concerns of creditors

A Greek government official said Athens would on Wednesday present a revised bailout request "taking into account" the concerns of international creditors and seek aid to tide it over until the end of the month.

New Greek finance minister Euclid Tsakalotos Photo: Greek finance minister Euclid Tsakalotos has been accused of presenting no new ideas. (AFP: Angelos Tzortzinis)

"The Greek government will tomorrow [Wednesday] present a 'common ground' document for a sustainable agreement, taking into account the outcome of the referendum, the common positions of political leaders and the proposals of the [creditor] institutions," the official said late on Tuesday.

Euro group head Jeroen Dijsselbloem said the ministers would hold a conference call on Wednesday to review a Greek request for a medium-term assistance programme from the European Stability Mechanism bailout fund.

Reflecting the irritation of several ministers, he said there was "no new proposal" from Mr Tsakalotos and the Euro group was still awaiting a Greek letter with one clear set of plans.

A Greek government official retorted: "Some are maintaining 'we don't have proposals' ... Is it really that 'we don't have proposals' or is it that they don't like our proposals?"

Mr Tsipras met privately with the leaders of Germany and France, the currency area's main powers, and European Commission president Jean-Claude Juncker just before the summit began.

Eurozone officials said there was no plan to issue any statement at the end of the summit.

Senior EU sources said Eurozone leaders could hold a further emergency summit on Sunday to approve a plan to aid Greece if creditor institutions are satisfied with a Greek loan application and reform plan.

US president Barack Obama also weighed in, speaking by telephone with Ms Merkel before talks with Mr Tsipras, the White House said.

"We continue to encourage all sides to participate constructively in those conversations," White House spokesman Josh Earnest said.


From other news sites:

Greek debt crisis: Athens launches desperate bid for aid with another summit - ABC News (Australian Broadcasting Corporation)