Eurozone finance ministers have reportedly rejected Greece’s request to extend bailout program beyond June 30.
According to The Wall Street Journal, Greece asked for a one-month extension of its expiring rescue deal.
But the request was swiftly rejected by the rest of the eurozone, three European officials said on June 27.
Greek Finance Minister Yanis Varoufakis made the request at a meeting with his eurozone counterparts in Brussels, a day after the government in Athens said it would hold a referendum on its bailout in which it would campaign against the policy overhauls and budget cuts demanded by its creditors.
The finance ministers of the other 18 eurozone countries will meet without Greece later Saturday evening, two European officials said.
Many ministers expressed surprise and disappointment toward Greece’s PM Alexis Tsipras’s decision to call for a referendum in which he would campaign against the budget cuts and policy overhauls demanded by his country’s creditors.
Alexander Stubb, Finland’s finance chief, was one of several ministers who said their negotiations would now focus on how to deal with the consequences of a Greek default.
“Plan B becomes Plan A,” Alexander Stubb told reporters.
Greek PM Alexis Tsipras has announced a referendum on a controversial bailout deal with foreign creditors for July 5.
In a TV address, Alexis Tsipras described the plan as “humiliation” and condemned “unbearable” austerity measures demanded by creditors.
The Greek government earlier rejected the proposals, aimed at avoiding Greece defaulting on its debt.
Greece has to make a €1.5 billion ($1.7 billion) IMF debt repayment on June 30.
Photo AFP
Alexis Tsipras said: “These proposals, which clearly violate the European rules and the basic rights to work, equality and dignity show that the purpose of some of the partners and institutions was not a viable agreement for all parties, but possibly the humiliation of an entire people.”
“The people must decide free of any blackmail,” he added.
Greece has refused to accept cuts to pension payments or public sector wages while the IMF is pushing for deeper spending cuts, not just more tax rises.
A key point of friction is a special benefit paid to some low-income pensioners, which creditors want scrapped.
Creditors also want a wider VAT base; Greece says it will not allow extra VAT on medicines or electricity bills, and has also resisted calls for VAT hikes on hotels and restaurants.
Athens wants a concrete commitment to debt relief, something its creditors are not offering.
Greece PM Alexis Tsipras has criticized the country’s international creditors for failing to accept his government’s latest reform proposals.
Alexis Tsipras said this never occurred with similar measures put forward by other states negotiating bailouts, suggesting creditors might not want a deal.
There are also reports that Greece has rejected an IMF counter-proposal seeking more pension and spending cuts.
Alexis Tsipras’ remarks came before he began new talks to secure a debt deal.
Greece must repay €1.6 billion to the International Monetary Fund (IMF) by the end of the month, or face default and possible exit from the EU.
Eurozone finance ministers are due to finalize a deal on June 24 by the end of the day.
On June 24, the ECB again increased additional emergency funding for Greek banks to stave off fears of a bank run – the fifth time in eight days it has done so as fearful savers withdraw up to €1bn a day from domestic banks.
Photo AP
Only once agreement is reached will creditors unlock the final €7.2 billion tranche of bailout funds.
The agreement being formed is believed to include:
New taxes on businesses and the wealthy
Selective increases in VAT
Savings in pensions linked to curbing early retirement and increasing pension contributions
No further reductions in pensions or public-sector wages – “red lines” for Greece’s Syriza government
PM Alexis Tsipras has been meeting the European Commission, the European Central Bank (ECB) and the International Monetary Fund (IMF) – the trio evaluating his proposals.
They are hoping to finalize a deal that would release further loans to Greece before it runs out of money.
Reuters news agency quoted a eurozone official as saying that, despite several hours of talks, there had been no breakthrough so far and the sides were “still stuck at the same red lines”.
European leaders hold an emergency summit in Brussels that could break the deadlock around Greece’s debt crisis.
Greece’s Prime Minister Alexis Tsipras said he hoped Greece would “return to growth within the eurozone”.
European finance ministers have said there is still no basis for making a decision for aid for Greece on June 22.
On June 21, Alexis Tsipras set out new proposals to try to prevent a default on a €1.6 billion IMF loan.
But he has ruled out pension cuts, higher power rates, and an excessive budget surplus.
Greece must repay the loan by the end of June or risk crashing out of the eurozone and possibly the EU.
Talks have been in deadlock for five months. The European Commission, the IMF and the European Central Bank (ECB) are unwilling to unlock the final €7.2 billion tranche of bailout funds until Greece agrees to economic reforms.
France’s President Francois Hollande has warned that there is “little time” to prevent Greece from leaving the eurozone.
On a visit to Algiers, Francois Hollande said the ball was firmly in Greece’s court.
“It’s not France’s position to impose on Greece further cuts to smaller pensions, but rather to ask that they propose alternatives,” the French president said on June 15.
“We have to get to work… everything must be done in order that Greece remains in the eurozone.”
Talks with Greek and EU officials in Brussels on June 14 failed to reach an agreement that would release bailout funds to Greece.
Eurozone finance ministers will meet on June 18, but Greek Finance Minister Yanis Varoufakis said he did not plan to present new proposals at the meeting.
Yanis Varoufakis told German newspaper Bild: “The Eurogroup [of eurozone finance ministers] is not the right place to present proposals which haven’t been discussed and negotiated on a lower level before.”
The prospects of a Greek default in just over two weeks’ time has worried investors.
On June 15, the FTSE 100 in London fell 1.1% to 6,710 points, while the DAX in Frankfurt lost 1.9% and the CAC 40 in Paris shed 1.75%.
In the US, the Dow Jones closed down 0.6%, or 107 points, at 17,791.
Athens’ benchmark ATG index, which fell 5.9% on Friday, fell a further 4.7% on June 15.
Greek bank stocks were hit hardest, with National Bank of Greece closed down 5.7% and Bank of Piraeus was 12.2% lower.
Europe wants Greece to make spending cuts worth €2 billion to secure a deal that will unlock bailout funds.
Greece must repay more than €1.5 billion of loans to the International Monetary Fund (IMF) at the end of June and promise further economic reforms to receive about €7 billion of bailout funds.
The funds have been delayed by three months amid growing fears the government will soon run out of money.
Sticking points between Greece and the IMF and EU remain reforms to VAT and pensions.
European Commission spokeswoman Annika Breidthardt rejected an assertion that creditors were seeking pension or wages cuts. They only wanted Athens to phase out early retirement and remove “incorrect incentives for early retirement”.
Greece had already agreed to specific targets for its primary surplus, she said, with 1% of GDP this year, followed by 2% in 2016 and 3.5% by 2018.
An opinion poll for Greece’s Mega TV found that more than two thirds of respondents believe the Greek government will have to back down, with just 19.4% thinking the lenders will agree to further concessions.
On June 15, Greek PM Alexis Tsipras warned Athens would stand its ground until its creditors become “realistic”.
Alexis Tsipras called on the IMF and EU to “meditate” on the idea that: “We are not only the heirs of a long history of struggle. We are also carrying on our shoulders the dignity of a people, and the hope of the peoples of Europe.”
Greece has announced it will delay June 5 €300 million ($330 million) debt repayment to the International Monetary Fund.
The country told the IMF it will bundle all four of its June payments together.
The Greek government will have until June 30 to pay the €1.5 billion total, which is also the day on which its bailout deal with the EU and IMF runs out.
PM Alexis Tsipras is trying to reach a deal to unlock final bailout funds before Greece runs out of money.
But Greece’s creditors say differences remain between the two sides.
IMF spokesman Gerry Rice said that under a precedent dating back to the late 1970s, governments could ask to bundle together “multiple principal payments falling due in a calendar month… to address the administrative difficulty of making multiple payments in a short period.”
The last country to bundle together payments to the IMF was Zambia in the mid-1980s.
Alexis Tsipras said after talks in Brussels on June 4 that an agreement with Greece’s international creditors was “in sight”.
However, the head of the eurozone’s finance ministers Jeroen Dijsselbloem, who was involved in the negotiations, said later the gap was “still quite large”.
High-level talks were expected to resume on June 5, although Alexis Tsipras was due to brief the Greek parliament rather than return to Brussels.
Alexis Tsipras rejected elements of proposals put forward by his country’s international creditors in talks with Jeroen Dijsselbloem and European Commission chief Jean-Claude Juncker.
He said the sides were now “very close to an agreement” on the key sticking point of primary surpluses – the amount by which tax revenues exceed public spending.
Alexis Tsipras also said there were “points that no-one would consider as a base for discussion”, citing cuts to pensions and a raise in sales tax for electricity.
Jeroen Dijsselbloem said the talks had been successful in narrowing down the remaining issues, although key differences still remained.
He expected Greece to “look at our proposals more carefully, probably come up with some alternative proposals that they want,” Reuters quoted him as saying.
Greece’s cash-strapped government has been haggling since February over the release of the last €7.2 billion in funds, but its current bailout arrangement with the IMF, European Central Bank (ECB) and European Commission runs out at the end of June.
Failure to reach a deal could trigger a Greek default and a potential exit from the eurozone.
Greece has “a realistic” debt deal proposal, PM Alexis Tsipras has said.
“We have submitted a realistic plan for Greece to exit the crisis,” he said.
Alexis Tspiras said the plan included “concessions that will be difficult”.
The prime minister’s statement follows talks in Berlin attended by the heads of both the International Monetary Fund (IMF) and the European Central Bank (ECB).
IMF chief Christine Lagarde and ECB president Mario Draghi presence at the meeting between German Chancellor Angela Merkel and France’s Francois Hollande underlines the seriousness of the talks.
Reports suggest the meeting was aimed at coming up with a “final proposal” to issue to Athens.
Howevr, Alexis Tspiras, who was not included in the meeting, said he had not yet been contacted by the IMF and European officials.
“We are not waiting for them to submit a proposal, Greece is submitting a plan – it is now clear that the decision on whether they want to adjust to realism… the decision rests with the political leadership of Europe,” he added.
A €300 million ($330 million) payment from Greece to the IMF is due on June 5.
There are fears Greece does not have the necessary funds to pay and could default on the debt, ultimately leading to its exit from the eurozone.
Friday’s payment is the first of four totaling €1.5 billion that Greece is due to pay to the IMF in June, and it is understood that the payments could be all bundled together and repaid in a single transaction at the end of the month.
If Greece decides to repay the funds in this way, it would have to notify the IMF, but it has not yet done so.
Greece remains in a four-month long deadlock with international creditors over the release of €7.2 billion in remaining bailout funds.
European lenders as well as the IMF are pushing for greater austerity reforms in return for the cash, which the Greek government has so far refused to make.
Syriza parliamentary spokesman Nikos Filis reiterated that the government would not sign an agreement that was incompatible with its anti-austerity program.
Greece is expected to reach an agreement with its international creditors within the next week, Finance Minister Yanis Varoufakis has said.
The Greek government is fast running out of money and is due to make a payment of €1.5 billion ($1.7 billion) to the International Monetary Fund (IMF) on June 5.
Yanis Varoufakis told Star TV a deal with creditors was “very close” and denied Greece might leave the eurozone.
“Another currency is not on our radar,” he said.
PM Alexis Tsipras also talked up the prospect of a deal in a speech to Greek business figures earlier, saying the government was “in the final straight” before a deal.
Greece has been locked in negotiations with the EU and IMF over economic reforms they say must be implemented before the final €7.2 billion tranche of the country’s €240 billion bailout is released.
Issues over pension reform, taxation, deregulation of the labor market, and the re-hiring of 4,000 former civil servants are yet to be resolved.
Last week, the government emptied its IMF reserves in order to pay €750 million in debt interest on its existing loans.
An apparent proposal from European Commission President Jean-Claude Juncker emerged in Greek newspaper To Vima on May 18 before a spokeswoman quickly said she was unaware of it.
However, the plan for emergency funding and smaller primary surplus targets, in return for limited Greek fiscal reforms worth €5 billion, was not completely denied.
A Commission spokeswoman said she was unaware of Jean-Claude Juncker’s reported proposal.
The status of Jean-Claude Juncker’s proposal was unclear, but European Economic Affairs Commissioner Pierre Moscovici complained in Berlin that the left-led government was “more eager to say what they don’t want to keep in the program than to propose alternatives”.
Greek media reported on May 19 that the government had sent proposals to its international creditors to revamp VAT rates in an attempt to tackle tax evasion.
Alexis Tsipras is due to attend the EU Eastern Partnership Summit in Riga, where Greece is likely to be a key topic.
Yanis Varoufakis said a payment deal was on the cards, but insisted he would reject any compromise he considered “non-viable”.
European Commission spokesman Margaritis Schinas has welcomed the commitment by the Greek government to bring the talks to a conclusion, but said more time and effort was needed “to bridge the gaps on the remaining open issues in the negotiations”.
Greece’s PM Alexis Tsipras has said his country is in the final, critical stretch of talks with its international creditors and that he believes an interim deal will be in place by May 9.
Greece’s objective was to find an agreement this week or next week at the latest, Alexis Tsipras said in a marathon TV interview on April 27.
Alexis Tsipras defended Finance Minister Yanis Varoufakis, who was sidelined from Greece’s negotiating team on April 27.
However, the prime minister admitted mistakes had been made in talks with EU partners.
Since Greece’s left-wing Syriza party came to power on January 25, it has sought to renegotiate the terms of the country’s €240 billion ($260 billion) bailout from the IMF and EU.
Greece’s negotiators have so far failed to satisfy the country’s international creditors with the scope of economic reforms required before the EU hands over the latest €7.2 billion tranche of the bailout, which the government needs to pay its bills.
Yanis Varoufakis was left isolated at an EU finance ministers meeting in Latvia on April 24, skipping a state dinner and tweeting a line from late US President Franklin Roosevelt.
Describing Yanis Varoufakis as an important asset for Greece, Alexis Tsipras argued that he had annoyed his European colleagues because he spoke their language better than they did.
From now on, Greece’s negotiations will be led by another economist in the government, Euclid Tsakalotos.
In his three-hour appearance on Greece’s Star TV, Alexis Tsipras acknowledged there was a “negative atmosphere” surrounding the talks but he suggested it was all a standard part of negotiations.
Alexis Tsipras was also critical of the government’s European negotiating partners, accusing them of reneging on a verbal commitment in February to allow Greek banks to finance the government.
“I believe we are close. I believe that if no-one wants to undermine or torpedo [the talks] we are close to an accepted package,” he said.
There would be concessions, the prime minister said, such as the part privatization of Piraeus port and the leasing of 14 regional airports.
Greece is facing a €200 million debt interest payment to the IMF on May 1st and has appealed to various public bodies to provide money from their cash reserves.
The big debt interest payment to the IMF is due on May 12, when the Greek government will have to find another €750 million.
Almost half the international investors surveyed by German research group Sentix believe Greece will leave the euro in the next 12 months.
Sentix’s break-up index for Greece rose from 35.5% in March to 48.8% in April, based on a survey of around 1,000 investors.
Alexis Tsipras rejected the idea of snap elections if EU talks failed but he did say that a referendum could be held on a final deal.
According to German finance minister Wolfgang Schauble, Greece would struggle to find creditors outside the EU and IMF.
Wolfgang Schauble said Greece would be welcome to try to find investment from Beijing or Moscow, but may have difficulties.
His warning came after fears of a Greek debt default saw its borrowing costs jump 3.5 percentage points to 27%.
Greek Finance Minister Yanis Varoufakis said his government refuses to consider leaving the EU: “Toying with Grexit… is profoundly anti-European.”
Yanis Varoufakis also promised to “compromise, compromise, compromise without being compromised” to satisfy current creditors.
Wolfgang Schauble and Yanis Varoufakis were speaking at talks in Washington.
On April 15, ratings agency S&P downgraded Greece’s credit rating.
Yields also rose on longer-term Greek borrowing, with the 10-year bond yield – the amount investors demand for lending – rising one percentage point to 13%.
Wolfgang Schauble said that the Greek government needs to find creditors.
“The Europeans have said, OK, we are ready to do it [lend money] until 2020… If you find someone else, whether it’s in Beijing, in Moscow, in Washington DC, or in New York who will lend you money, ok, fine, we would be happy. But it’s difficult to find someone who is lending you in this situation amounts [of] €200 billion.”
He added that Greece must focus on increasing its competitiveness and primary surplus.
Wolfgang Schaeuble was speaking after the Greek government’s borrowing costs surged on April 16.
According to the Financial Times, Greece had made an “informal approach” to the International Monetary Fund to have its bailout repayments delayed, but had been rebuffed.
However, IMF chief Christine Lagarde said at the World Bank spring meeting in Washington: “We have never had an advanced economy asking for payment delays.
“Payment delays are analysed as additional financing granted to that country. Additional financing means additional contribution by the international community – some of which are in much direr situations than the country eventually seeking those delays.
“Payment delays had not been granted by the board of the IMF in the last 30 years and it was eventually granted to a couple of developing countries and that delay was not followed by very productive results.
“It’s clearly not a course of action that would actually fit or be recommendable in the current situation.”
Greece owes the IMF some €1 billion ($1.06 billin) in repayments next month.
Many in the markets think the Greek government will struggle to make those payments if it does not agree an economic reform package with European creditors soon.
Failure to agree a plan with creditors will mean that the country will default, a development that could force the government to put limits on money transfers and even lead Greece to leave the euro.
EU spokesman Margaritis Schinas said on April 16 that the EU was “not satisfied with the level of progress made so far” in debt negotiations.
Wolfgang Schauble had warned that he did not expect an agreement between Athens and its creditors in the next week.
However, Greek PM Alexis Tsipras on April 16 said he was “firmly optimistic” the Greek government could reach a deal with its creditors.
“Despite the cacophony and erratic leaks and statements in recent days from the other side, I remain firmly optimistic that there will be an agreement by the end of the month,” Alexis Tsipras said.
According to Alexis Tsipras, several points of agreement had been found since talks first started, including on areas such as tax collection, corruption and initiatives to distribute the tax burden on those who have the ability to pay.
HEe said the two sides still disagreed on four areas: labor issues, pension reform, an increase in value-added taxes and privatizations, which he referred to as “development of state property”.
In a later tweet, Alexis Tsipras said he was “certain that Europe will choose the path to democracy”.
The Greek government has dismissed media reports that the country is preparing to default on its loans if it cannot reach agreement on its bailout terms with international creditors.
A government spokesman said negotiations were proceeding swiftly towards a solution.
Greece negotiated a three-month extension to its €240 billion ($272 billion) bailout at the end of February.
The Greek government is due to pay the IMF €203 million on May 1st and €770 million on May 12th.
Photo Reuters
However, reports suggest the government is rapidly running out of money. It needs to find €2.4bn to pay civil service salaries and pensions this month.
The Greek government has also denied reports that it was considering calling early elections if it failed to negotiate a settlement with its international creditors.
Last week, eurozone officials said Greece only had six working days left to come up with a revised list of reforms to seal a deal on its next rescue bailout.
Eurozone deputy finance ministers want an agreement on the €7.2 billion loan in time for a Eurogroup meeting on April 24th.
PM Alexis Tsipras has said that Athens will not be able to service its debt without financial help from the European Union.
Greece’s PM Alexis Tsipras has arrived in Moscow for talks with President Vladimir Putin, as his country struggles with a debt crisis.
Alexis Tsipras will also meet Russian PM Dmitry Medvedev on April 9.
Greece is embroiled in negotiations with the EU and IMF to unblock a bailout package and could run out of funds within weeks.
Greek officials have previously pointed to Russia as a possible alternative source of financial assistance.
Analysts say Russia’s own economic woes mean any help would be limited.
“Russia is not and cannot be a (EU) substitute for Greece, it can only be a supplementary option,” said Constantinos Filis from the Institute of International Relations.
Alexis Tsipras and Vladimir Putin are expected to discuss ties between the EU and Russia, which were badly strained by the Ukraine crisis.
Before his arrival, Alexis Tsipras described the sanctions imposed by the EU and US on Russia in the wake of its annexation of the Crimea as “a road to nowhere”.
The European Parliament President, Martin Schulz, said Alexis Tsipras should not break with the EU line on sanctions.
“Greece demands and gets a lot of solidarity from the EU. We can therefore also ask for solidarity from Greece and for this solidarity not to be ended unilaterally by pulling out of joint measures,” he told a regional German newspaper, the Muenchner Merkur.
Russia imposed a ban on many western food imports in retaliation, but Agriculture Minister Nikolai Fyodorov has said the government could consider removing three countries, including Greece, from the embargo, Russian state media reported.
Alexis Tsipras came to power pledging to end austerity, but his plans have met resistance from Greece’s EU/IMF creditors, who lent the country billions to help it avoid bankruptcy.
Greece has not received bailout funds since August 2014, with the EU and IMF dissatisfied with the pace of Greek reforms.
A Greek repayment of €448 million ($483 million) to the IMF is due on April 9.
On April 7, the Greek government said Germany owed Greece nearly €279 billion ($303 billion) in war reparations for the Nazi occupation during World War Two.
Germany owes Greece nearly €279 billion ($303 billion) in war reparations for the Nazi occupation during World War Two, the Greek government says.
It is the first time Greece has officially calculated what Germany allegedly owes it for Nazi atrocities and looting during the 1940s.
However, the German government says the issue was resolved legally years ago.
Greece’s radical left Syriza government is making the claim while struggling to meet massive debt repayment deadlines.
PM Alexis Tsipras raised the reparations issue when he met German Chancellor Angela Merkel in Berlin last month.
Photo Wikipedia
The new figure given by Greek Deputy Finance Minister Dimitris Mardas includes €10.3 billion for an occupation loan that the Nazis forced the Bank of Greece to pay.
“According to our calculations, the debt linked to German reparations is 278.7 billion euros,” Dimitris Mardas told a parliamentary committee investigating responsibility for Greece’s debt crisis.
Dimitris Mardas said the reparations calculation had been made by Greece’s state general accounting office.
Berlin paid 115 million Deutschmarks to Athens in 1960 in compensation – a fraction of the Greek demand. Greece says it did not cover payments for damaged infrastructure, war crimes and the return of the forced loan.
Germany insists the reparations issue was settled in 1990 legally and politically before Germany reunified.
Syriza politicians have frequently blamed Germany for the hardship suffered by Greeks under the tough bailout conditions imposed by international lenders.
PM Alexis Tsipras is trying to renegotiate the €240 billion EU-IMF bailout that saved Greece from bankruptcy. Greece has not received bailout funds since August last year, as the lenders are dissatisfied with the pace of Greek reforms.
A Greek repayment of €448 million to the International Monetary Fund is due on April 9.
Greek Finance Minister Yanis Varoufakis has said that Greece “intends to meet all obligations to all its creditors, ad infinitum”.
Greece has threatened to seize German property as compensation for a Nazi atrocity in World War II.
Justice Minister Nikos Paraskevopoulos said he was ready to approve a Supreme Court ruling from 2000 backing payment to relatives of the 218 victims.
The debt-ridden government is already calling for Germany to pay billions of euros in wartime reparations.
Germany insists the issue of compensation was settled in 1990, before the country was reunified.
Chancellor Angela Merkel’s spokesman Steffen Seibert said on March 11 it was Germany’s firm belief that the question had been resolved legally and politically.
“We should concentrate on current issues and, hopefully what will be a good future,” he said, referring to Greece’s financial crisis and the Athens government’s proposals for a renegotiation of its bailout package from the EU and IMF.
Greek PM Alexis Tsipras told parliament late on March 10 that he had a duty to pursue reparations dating back to the Nazi occupation of 1940-1944, arguing that Germany had adopted “silence, legal tricks and delays” since reunification in 1990.
However, the justice minister went further, saying he was prepared to enforce the Supreme Court’s ruling in 2000 relating to the massacre of 218 civilians in the central Greek village of Distomo on June 10, 1944.
The court ruled that Germany should pay €28 million to the relatives of those killed, although the decision was not enforced, and the dispute effectively reached stalemate in international courts in the following years.
The ruling allowed for German-owned property to be seized as compensation but it was never acted on by then-Justice Minister Michalis Stathopoulos.
Among possible assets are property belonging to Germany’s archaeological school and the Goethe Institute, a cultural association.
Greek relations with Germany have deteriorated in recent years because of the financial crisis, with Germany one of the big contributors to the eurozone bailout that began in 2010.
German ministers have been among the most vocal advocates for budget and income cuts in Greece, which has led to growing resentment among Greeks.
The new leftist government in Athens argues that austerity measures be relaxed, a demand opposed by Germany and other eurozone creditor nations.
Germany did pay compensation of 115 million Deutsche marks in 1960, as part of an agreement with several European countries for the Nazi occupation.
Greece says the 1960 deal did not cover key demands, including payments for damaged infrastructure, war crimes and the return of a forced loan exacted from occupied Greece.
PM Alexis Tsipras said Greece would honor its bailout creditors, but that he would not “abandon its irrevocable demands'” for World War II reparations.
Greece’s anti-austerity PM Alexis Tsipras has warned of “real difficulties” ahead, as his government faces February 23 deadline to submit a list of reforms to lenders.
Under a deal agreed on February 20, the list must be approved by the international creditors in order for Greece to secure a four-month extension of its bailout.
“We won a battle, not the war,” Alexis Tspiras said on February 21.
The deal is widely regarded as a major climb down for the prime minister, who won power vowing to reverse budget cuts.
Alexis Tsipras hailed the agreement as a “decisive step” that “achieved much” towards ending austerity, but added: “We have a long and difficult road ahead.”
The Greek cabinet is due to meet to discuss it on February 21.
No details have emerged about the potential list of reforms, which must be approved before eurozone members ratify the bailout extension on Tuesday.
Analysts say a collapse of the deal would revive fears of an exit from the euro, a so-called “grexit” – something both the EU and Greece say they want to avoid.
German Finance Minister Wolfgang Schaeuble stressed on February 20 that there would be no payment of new funds to Greece until the conditions of the deal had been met.
Greek Finance Minister Yanis Varoufakis said he would work night and day until February 23 to devise the list of reforms.
“If the list of reforms is not agreed, this agreement is dead,” he admitted.
The Greek Communist Party (KKE) accused the coalition, which is led by its far-left rivals Syriza, of extending the bailout without getting the loan conditions changed.
“Ultimately the bill will be footed by the people, as it happened with all previous governments,” KKE leader Dimitris Koutsoumbas said.
The Greek government is already in trouble with its voters for seeking the bailout extension at all – something it swore it would never do.
According to new reports, Greece is expected to request a six-month extension of its loan agreement on February 18.
The loan would not be an extension of the current bailout agreement, which includes strict austerity measures, Greek government officials were quoted as saying.
On February 16, Greece rejected a plan to extend its 240 billion euros bailout describing it as “absurd”.
Without a deal, Greece is likely to run out of money.
The eurozone has given Greece until February 20 to decide if it wants to continue with the current bailout deal.
Greece wants to replace the bailout with a new loan that it says would give it time to find a permanent solution to the debt crisis.
The country’s current bailout expires on February 28. Any new agreement would need to be approved by national governments, so time is running out to reach a compromise.
Earlier Greek PM Alexis Tsipras called for a vote to scrap its austerity program on February 20, the same day as the eurozone deadline.
“We will not succumb to psychological blackmail,” Alexis Tsipras told parliament.
“We are not in a hurry and we will not compromise.”
Earlier, Germany’s Finance Minister, Wolfgang Schaeuble, said that Greece needed to make up its mind whether it wanted to extend the bailout program.
“None of my colleagues so far understands what Greece wants… whether Greece itself knows is not clear either,” he said.
Alexis Tsipras criticized Wolfgang Schaeuble, saying that the German finance minister had lost his cool on Monday.
“Not because he spoke up against the Greek government, because that is his right, but he spoke condescendingly towards the Greek people,” he said.
The Greek stock exchange closed down by 2.45%, having fallen by as much as 4% earlier in the day.
JP Morgan claimed over the weekend that €2 billion worth of deposits was flowing out of Greek banks each week and estimated that if that were to remain the case, they would run out of cash to use as collateral against new loans within 14 weeks.
Greece is seeking a bridge loan rather than an extension of its bailout, PM Alexis Tsipras has said.
In an address to parliament, Alexis Tsipras also promised measures to cut bureaucratic spending and said his government would stick to all its pre-election pledges.
Alexis Tsipras’s far-left Syriza party won elections last month on a promise to end austerity measures.
EU officials have rejected his efforts to renegotiate Greece’s bailout terms.
“The bailout failed,” Alexis Tsipras said told parliament on February 8.
“The new government is not justified in asking for an extension … because it cannot ask for an extension of mistakes.”
The prime minister said that Greece wanted to service its debt.
“If our peers want so too, they are invited to come to the table of dialogue so we can discuss how to make it viable,” he added.
Greece’s current program of loans ends on February 28. A final €7.2 billion is still to be negotiated, but the new government does not want to extend the program and has already begun to roll back austerity measures.
Greek debt stands at more than €320 billion, or about 174% of the country’s economic output.
Photo Reuters
In last month’s elections Syriza fell just short of an outright majority and formed a coalition government with the centre-right Independent Greeks.
In his speech, Alexis Tsipras said the government’s “irreversible decision is to implement in full our pre-elections pledges”.
The first priority, he said, was “tackling the big wounds of the bailout, tackling the humanitarian crisis”.
That includes giving free food and electricity to those worst affected by the economic crisis, and ending an unpopular annual levy on private property.
Among other commitments outlined by the prime minister on February 8 were:
a gradual rise in the minimum wage to €751 by 2016
reinstatement of public sector employees “fired illegally”
creation of a new national broadcaster.
A number of measures aimed at cutting costs or raising revenue were also announced, including:
a new tax on large properties
a special portfolio to oversee fight against corruption and tax evasion
a pension fund using revenues from natural resources
cutting ministry cars and government planes.
Alexis Tsipras also repeated demands that Germany pay reparations for World War Two and repay a loan that the Nazis forced the Bank of Greece to pay when they occupied Greece.
Greece had “a moral obligation to our people, to history, to all European peoples who fought and gave their blood against Nazism”, Alexis Tsipras said.
Greece’s PM Alexis Tsipras says he believes it will be possible to find a solution to the stand-off with the EU over his country’s debt.
Alexis Tsipras said he was “optimistic” after meeting the heads of the European Commission, European Council and European Parliament in Brussels.
The new prime minister and his finance minister are on a diplomatic offensive to reassure eurozone leaders about their plans.
Alexis Tsipras has pledged to renegotiate the terms of a €240 billion bailout.
His far-left party Syriza was elected last month on a promise to end austerity measures.
“We respect the rules of the European Union,” Alexis Tsipras said after his meetings on February 4.
“I’m very optimistic… Of course we don’t have already an agreement but we are in a good direction to find a viable agreement.”
Speaking at the joint news conference, European Parliament President Martin Schulz described their talks as “fruitful” but said there were difficult times ahead.
Meanwhile, Greek Finance Minister Yanis Varoufakis said his talks with ECB chief Mario Draghi in Frankfurt had also been encouraging.
“We had a very fruitful discussion and exchange,” Yanis Varoufakis told reporters.
He is keen to convince the ECB that Greece’s debt payments could be linked to the performance of the economy – the more it grows the more interest Greece would pay – through the use of debt swaps.
However, a report in the Financial Times quoted officials involved in the negotiations as saying that the ECB would oppose a crucial part of his plan – the sale of short-term treasury bills to raise €10 billion.
Today’s talks were the latest in a series of European trips to reassure leaders about the plans of a government elected on January 25 on a promise of writing off most of Greece’s spiraling debt.
Alexis Tsipras’s Syriza party had also sparked alarm on the markets and among eurozone officials when it said it would refuse a new tranche of bailout funding, prompting questions about how it would finance itself.
Greece’s current program of loans ends on February 28. A final €7.2 billion is still to be negotiated, but the new government has already begun to roll back austerity measures.
Yanis Varoufakis is hoping to obtain quick cash for Greece while a new plan is agreed amongst the various eurozone members.
Eurozone finance ministers are due to meet on February 11 to discuss Greece’s debt proposals.
Earlier, Alexis Tsipras met European Commission President Jean-Claude Juncker and European Council President Donald Tusk.
Jean-Claude Juncker was expected to press Alexis Tsipras for a “technical” extension of Greece’s current deal. The Greek leader is to travel to Paris to meet President Francois Hollande later.
On February 5, Yanis Varoufakis is expected to meet Wolfgang Schaeuble, the German finance minister.
Wolfgang Schaeuble has emerged as the one of the toughest critics of the new Greek government, previously saying: “Elections change nothing. There are rules.”
German Chancellor Angela Merkel has ruled out Greece’s debt cancellation, saying creditors had already made concessions.
Greece still has a debt of €315 bilion – about 175% of GDP – despite some creditors writing down debts in a renegotiation in 2012.
Greece’s new PM Alexis Tsipras has said he is confident that agreement can be reached with creditors over repayment of his country’s debts.
Alexis Tsipras said in a statement issued to Bloomberg news agency that he had never intended to act unilaterally.
This week, German Chancellor Angela Merkel has ruled out debt cancellation, saying creditors had already made concessions.
Alexis Tsipras’ Syriza party won last weekend’s election with a pledge to have half the debt written off.
Its new Finance Minister Yanis Varoufakis has refused to work with the “troika” of global institutions overseeing Greek debt, which had agreed a €240 billion ($270 billion) bailout with the previous Greek government.
The troika is made up of the European Commission, European Central Bank and International Monetary Fund.
Greece still has a debt of €315 billion – about 175% of gross domestic product – despite some creditors writing down debts in a renegotiation in 2012.
Alexis Tsipras said Greece would repay its debts to the ECB and IMF, and reach a deal with the eurozone nations that funded most of the bailout package.
“The deliberation with our European partners has just begun,” he said.
“Despite the fact that there are differences in perspective, I am absolutely confident that we will soon manage to reach a mutually beneficial agreement, both for Greece and for Europe as a whole.”
Jeroen Dijsselbloem, chairman of the eurozone finance ministers’ group, said he welcomed Alexis Tsipras’ comments.
“It is now up to the Greek government to determine its position on how to move forward,” he said.
“Further decisions will be taken jointly in the Eurogroup in the coming weeks.”
In interviews in the German media published on Saturday, Angela Merkel said she still wanted Greece to stay in the eurozone but did not “envisage fresh debt cancellation”.
“There has already been voluntary debt forgiveness by private creditors, banks have already slashed billions from Greece’s debt,” she told Hamburger Abendblatt.
Greece’s current program of loans ends on February 28. A final bailout tranche of €7.2 billion still has to be negotiated but the new government has already begun to roll back austerity measures.
German Chancellor Angela Merkel has ruled out canceling any of Greece’s debt, saying banks and creditors have already made substantial cuts.
However, Angela Merkel told the Hamburger Abendblatt newspaper she still wanted Greece to stay in the eurozone.
Greece’s left-wing Syriza party won last weekend’s election with a pledge to have half the debt written off.
Its finance minister said the “troika” of global institutions overseeing Greek debt was a “rotten committee”.
The troika – the European Commission, European Central Bank (ECB) and International Monetary Fund (IMF) – had agreed a €240 billion ($270 billion) bailout with the previous Greek government.
Greece’s new Finance Minister Yanis Varoufakis has refused to work with the troika to renegotiate the bailout terms and has already begun to roll back the austerity measures the creditors had demanded of the previous government.
Angela Merkel told the Hamburger Abendblatt: “I do not envisage fresh debt cancellation.”
She said: “There has already been voluntary debt forgiveness by private creditors, banks have already slashed billions from Greece’s debt.”
Greece still has a debt of €315 billion ($355 billion) – about 175% of gross domestic product – despite some creditors writing down debts in a renegotiation in 2012.
Angela Merkel insisted she did not want Greece to leave the eurozone.
She said: “The aim of our policy was and is that Greece remains permanently part of the euro community. Europe will continue to show its solidarity with Greece, as with other countries hard hit by the crisis, if these countries carry out reforms and cost-saving measures.”
On January 30, German Finance Minister Wolfgang Schaeuble warned Greece about its negotiation tactics on writing off debt.
“There’s no arguing with us about this, and what’s more we are difficult to blackmail,” he said.
Finance Minister Yanis Varoufakis refused to work with the troika, saying he would instead talk to individual organizations and EU member states.
Yanis Varoufakis has brought forward to Saturday his planned trip to Paris, where he will meet French counterpart Michel Sapin.
Greece’s current program of loans ends on February 28. A final bailout tranche of €7.2 billion still has to be negotiated.
New Greek Prime Minister Alexis Tsipras will visit Cyprus, Italy and France next week but has no plans to visit Germany as yet.
Greece’s new Finance Minister Yanis Varoufakis says his government will not negotiate over the Greek bailout conditions with the “troika” team from the EU and IMF.
Yanis Varoufakis said he was rather seeking direct talks with eurozone leaders, to try to cancel more than half the money Greece owes.
The minister was speaking after meeting Jeroen Dijsselbloem, head of the Eurogroup – the eurozone finance ministers.
Jeroen Dijsselbloem said Greece should stick to its reform commitments.
He said Greece and the Eurogroup had a “mutual interest in the further recovery of the Greek economy inside the eurozone” and warned against Athens acting unilaterally in its efforts to renegotiate its bailout.
Greece has endured tough budget cuts in return for its €240 billion ($270 billion) bailout, agreed in 2010 with the “troika” – the European Commission, International Monetary Fund (IMF) and European Central Bank (ECB).
There was little warmth between the two men at the news conference, with Jeroen Dijsselbloem making a brusque exit.
Breaking with tradition, Yanis Varoufakis wore an open-neck shirt – hanging loose at his belt. Jeroen Dijsselbloem was dressed conventionally.
On the troika, Yanis Varoufakis said: “We have no intention of co-operating with a three-member committee whose goal is to implement a program whose logic we consider anti-European.”
Jeroen Dijsselbloem, who is also Dutch Finance Minister, said the two sides would decide what would happen next before the bailout program ends – that is, by February 28.
He also met Greek PM Alexis Tsipras in Athens, who led the Syriza radical left-wing coalition to victory in elections on Sunday.
Yanis Varoufakis, meanwhile, said Greece was not asking for an extension of the existing bailout, but seeking a “new agreement that will emerge following talks between all Europeans”.
He said he would he seek “maximum co-operation” with Greece’s international creditors, but that he would not work through the “troika”, which he called “a committee built on rotten foundations”.
Jeroen Dijsselbloem rejected Alexis Tsipras’s idea of convening a European conference on debt.
“This conference already exists and it’s called the Eurogroup,” he told the news conference.
Syriza won on an anti-austerity platform, promising to have half of Greece’s debt written off, and to roll back on deep cuts to jobs, pay and pensions.
Greece’s economy has shrunk drastically since the 2008 global financial crisis, and high unemployment has thrown many Greeks into poverty.
The new government has already pressed ahead with cancelling major privatization projects, including of the two main ports of Piraeus and Thessaloniki.
But EU officials have warned there is little appetite among eurozone countries for cutting the debt.
Greece has about €20 billion ($22.5 billion) to repay this year, according to the Greek finance ministry.
Economists estimate that Greece needs to raise about €4.3 billion in the first quarter.
Ahead of his visit to Greece, European Parliament President Martin Schulz says he will use “straight talking” in his first meeting with Alexis Tsipras’ government.
Martin Schulz’s visit to Athens comes amid concerns over steps by PM Alexis Tsipras to halt austerity measures.
Greek bank stocks edged back up on January 29 a day after dipping sharply as the government shelved privatization schemes required under bailout terms.
European leaders have insisted Greece must meet its debt obligations.
Alexis Tsipras has said he wants to renegotiate the terms – but insisted there will be no Greek default, which is feared may push Greece out of the eurozone.
Greece has endured tough budget cuts in return for its €240 billion ($270 billion) bailout, negotiated in 2010 with the “troika” – the European Union, International Monetary Fund (IMF) and European Central Bank (ECB).
Its economy has shrunk drastically since the 2008 global financial crisis, and high unemployment has thrown many Greeks into poverty.
Ahead of his visit, the European Parliament president told Germany’s Bild newspaper he would encourage Alexis Tsipras to clamp down on tax evasion in Greece.
However, Martin Schulz he said he would focus on “straight talking” and had “no desire” to debate fiscal plans.
Germany’s Vice-Chancellor Sigmar Gabriel also reiterated the need for Greece to respect the terms of its bailout on Thursday.
Speaking in the German parliament, Economy Minister Sigmar Gabriel said the new Greek government could not expect the rest of Europe to carry what he called their “burden”.
“People must respect the democratic decision of voters and a newly-elected government’s right to decide its course but the rest of Europe’s citizens should not have to expect changes in Greek politics to burden them,” he said.
Jeroen Dijsselbloem, the president of the Eurogroup club of eurozone finance ministers, will visit Athens on January 30.
Ahead of the dignitaries’ trips, European Commission President Jean-Claude Juncker reiterated that cancelling Greece’s huge debt was not an option.
“Greece must comply with Europe,” Jean-Claude Juncker said in an interview with French newspaper Le Figaro on January 29, stressing that “there is no question of cancelling the debt”.
“Arrangements are possible, but they will not fundamentally alter what is in place.”
In his first cabinet meeting since Syriza’s election victory, PM Alexis Tsipras insisted that his country would not default on its debts and vowed to negotiate with creditors over the bailout.
The Athens Stock Exchange fell by 9% in response to Alexis Tsipras’s remarks on January 28 as it emerged that his Syriza-led government was putting on hold major privatization projects, including the port of Piraeus and the main power company, the Public Power Corporation of Greece.
Greek stocks rebounded on January 29, with the National Bank of Greece up 6.7% and Alpha Bank up 11.8%, according to Reuters.
Addressing his first cabinet meeting, Greece’s new Prime Minister Alexis Tsipras says his country will not default on its debts.
Alexis Tsipras said he would negotiate with creditors over the €240 billion ($270 billion) bailout.
“We won’t get into a mutually destructive clash but we will not continue a policy of subjection,” said the left-wing Syriza party leader.
Germany’s vice-chancellor, Sigmar Gabriel, said it was unfair of Greece to expect other states to pick up its bills.
“I cannot imagine a haircut [debt reduction],” Sigmar Gabriel said.
As Alex Tsipras made his debut cabinet speech, Greek government bond yields rose to their highest since the 2012 debt restructuring, amid investor concern that the anti-austerity coalition was gearing up for a clash with international creditors.
The Athens Stock Exchange fell by 8% in response to Alexis Tsipras’s remarks, and as it emerged that his government was putting on hold major privatization projects, including the port of Piraeus and the main power company, the Public Power Corporation of Greece.
Greece has endured tough budget cuts in return for its 2010 bailout, negotiated with the “troika” – the European Union, International Monetary Fund (IMF) and European Central Bank (ECB).
The country’s economy has shrunk drastically since the 2008 global financial crisis, and high unemployment has thrown many Greeks into poverty.
Vowing to defend Greek dignity, Alexis Tsipras said a renegotiation of the Greek debts would aim for a “viable, fair, mutually beneficial solution”. He did not give any details.
Alexis Tsipras promised “realistic proposals” for an economic recovery and vowed to fight corruption and tax evasion. His recovery plan, he said, was aimed at preventing deficits in the future.
The new coalition government – with the right-wing but equally anti-austerity Greek Independents – was sworn into office on January 27.
Its chief economics spokesman, Euclid Tsakalotos, has argued that it is unrealistic to expect Greece to repay its huge debt in full.
The current bailout program of loans to Greece ends on February 28. There are still 1.8 billion euros of loans that could be disbursed to Greece if it meets the conditions imposed by the troika.
Economists estimate that Greece needs to raise about 4.3 billion euros in Q1 2015 to help pay its way, with Athens possibly having to ask the IMF and eurozone countries.
Sigmar Gabriel, who is also economy minister and leads the junior partner in Angela Merkel’s coalition government, said: “Our aim must be to keep Greece in the eurozone but solidarity and fairness work both ways.”
“Citizens of other euro states have a right to see that the deals linked to their acts of solidarity are upheld,” he said.
“Every country in Europe has its own history and cannot separate itself from this through new elections.”
Sigmar Gabriel urged the Greek government to talk to its partners before going ahead with decisions such as halting the privatization of the port of Piraeus.
“Things that Greece itself won’t do cannot be shunted on to the taxpayers and employers in neighboring states,” the German Social Democrat leader said.
Greek 10-year bond yields climbed above 10%, reflecting fears that investors may not get their money back.
The yield of a bond is inverse to its price: as the price goes down, the yield grows.
Greece’s new Prime Minister Alexis Tsipras has formed a new cabinet with Yanis Varoufakis as finance minister and right-winger Panos Kammenos as defense minister.
Yanis Varoufakis is an outspoken critic of the conditions imposed on Greece in return for the 2010 bailout.
He will have the tough job of leading talks with the EU over the Syriza party’s pledge to renegotiate Greece’s massive international bailout.
Panos Kammenos is a member of the anti-bailout Independent Greeks party.
It joined a coalition with Syriza, after the left-wing party narrowly failed to secure a majority in parliament in Sunday’s elections.
The EU has meanwhile warned that the new government must stick to its creditor commitments.
The government’s chief economics spokesman, Euclid Tsakalotos, has argued that it is unrealistic to expect Greece to repay its huge debt in full.
Correspondents say that the appointment of Yanis Varoufakis – who holds dual Greek and Australian nationality – is a signal that the new Syriza-led coalition will take an uncompromising stance when renegotiating Greece’s €240 billion ($270 billion) EU-IMF package.
Yanis Varoufakis insists that Greece cannot restore its finances until its debt is lessened and has described the bailout as “fiscal waterboarding”.
Before the appointment of Yanis Varoufakis, PM Alexis Tsipras said EU leaders needed now to show that they were willing to work with Syriza – and that it would be his “worst nightmare” if the eurozone collapsed because Greece fell.
The appointment of Panos Kammenos into the 11-minister cabinet is also likely to be controversial, correspondents say, because of his claims that Germany is to blame for his country’s economic woes by its insistence on budgetary belt tightening.
Other key appointments made by the prime minister include: Nikos Kotzias as foreign minister, Nikos Pappas as state minister, Nikos Voutsis as interior minister, Panagiotis Lafazanis as production and environment minister, Panos Skourletis as labor and social solidarity minister.
Greek elections big winner, the far-left Syriza party, has formed an anti-austerity coalition with a right-wing party, the Independent Greeks.
Syriza leader Alexis Tsipras has taken the oath as the new prime minister.
Alexis Tsipras has vowed to renegotiate Greece’s bailouts, worth €240 billion ($268 billion).
European Commission head Jean-Claude Juncker congratulated Alexis Tsipras while reminding him of the challenge of “ensuring fiscal responsibility”.
“The European Commission stands ready to continue assisting Greece in achieving these goals,” Jean-Calude Juncker said in a tweet which also referred to “promoting sustainable jobs and growth”.
The euro recovered from an 11-year low against the US dollar as investors digested what Syriza’s victory means for the eurozone’s future.
Europe’s main share markets also rose – after initial falls – on hopes that a compromise over Greece’s bailout terms might be found.
With nearly all of the votes counted in Sunday’s poll, Syriza looks set to have 149 seats, just two short of an absolute majority. The Greek Independents are projected to have 13 seats in the 300-seat parliament.
Greece election result is expected to be one of the main issues at Monday’s meeting of 19 eurozone finance ministers.
Sunday’s result means that a majority of voters in Greece have essentially rejected a core policy for dealing with the eurozone crisis as devised by Brussels and Germany.
The troika of lenders that bailed out Greece – the European Union, European Central Bank, and International Monetary Fund – imposed big budgetary cuts and restructuring in return for the bailout money.
The man tipped to become the new Greek finance minister, Yanis Varoufakis, said the austerity regime had been “fiscal waterboarding policies that have turned Greece into a debt colony”.
Greece’s economy has shrunk drastically since the 2008 global financial crisis, and increasing unemployment has thrown many Greeks into poverty.
On January 25, Alexis Tsipras told jubilant supporters he wanted to write off half of Greece’s debt, but was ready to negotiate “a viable solution” and wants the country to stay in the eurozone.
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