European Central Bank refuses to Greek plan – Milenio.com

European Central Bank refuses to Greek plan – Milenio.com

The European Central Bank (ECB) resists key new rescue plan Greek government element, which can potentially leave Athens without an external source of financing when its international bailout expires later this month.

Yanis Varoufakis, Greek Finance Minister proposed to European officials that Athens collect 10 billion euros by issuing Treasury bonds short term, as a “transitional funding” to move the country forward during three months, while reaching agreement on a new bailout with its partners in the euro area.

But the ECB is not willing to approve the sale of debt. It will not raise the ceiling of 15 billion euros in bond Treasury 25 billion euros as requested, according to two officials involved in the discussions.

“The Greek plan depends in the whole European Central Bank, “said another official of the euro area as reported on the talks. “The ECB will be hard.”

With the absence of financing Treasuries, Athens will rescue without access to emergency funds for the first time since its first bailout in 2010.

The ECB’s position increases the risk of a clash between the radical government against austerity in Athens and its international creditors, which, if not resolved, could end in Greece runs out of money in a few weeks.

It is also likely to affect the feeling of optimism among investors about another bailout of Greece and soften its insistence on debt cancellation, which grew to the Athens Stock Exchange 11.3 percent yesterday and reduced borrowing costs to 10 years almost one percentage point.

The Greek government said it can survive without extra cash until June, when the term of a bond of 3000 EUR 500 million over. However, many EU officials fear that allowing the program without effect, can cause a panic in the markets and banks. Withdrawals scale of Greek credit institutions declined in recent days, officials said.

Jean Claude Juncker, president of the European Commission, expected to pressure the Greek Prime Minister Alex Tsipras, so ask for a “technical” extension of its current bailout plan when they meet in Brussels today, where fears that Greece between growing up in uncharted waters.

But officials who met with Varoufakis told insists that for political reasons the government can not request an extension, and would send a signal that they are willing to continue the current bailout plan, a message Varoufakis reiterated at the meeting in London on Monday. “They realize that their influence is low but feel they are on a mission, and gives the impression that they are prepared to risk a lot,” said a senior banker at the meeting.