The awaited meeting was short and ended with a total disagreement. The European proposal is “unacceptable,” said Athens. Require follow the bailout program, but Greece is denied.
The negotiations between Greece and the Eurogroup -made up the finance ministers of the euro area – collapsed soon after started in Brussels that Athens flatly rejected the proposal to request an extension of six months after its bailout program, calling it “unacceptable.” Eurogroup governments gave four days to Athens to accept his proposal. The break seems for now complete and both parties were very far from agreement. At stake is the gigantic debt of Greece in Europe and in substantially the same membership of Athens to the euro.
The Greek radical left government took office last month with the promise to end rescue program with 240,000 million, reversing the austerity policies imposed and end inspections of European envoys and IMF lenders that huge sum. The Dutch Finance Minister, Jeroen Dijsselbloem, head of the Eurogroup and who chaired the meeting in Brussels, said Athens has “until Friday” to ask for an extension of the bailout program. This expires at the end of the month.
It is not clear how long can you keep Greece afloat without international help, since you pay current expenses such as salaries, with European emergency funds. So far, the European Central Bank (ECB) has allowed the Greek central bank will deliver emergency funding to banks, but could impose capital controls if the negotiations collapse. Tomorrow the ECB will decide whether kept emergency loans to Greek banks, which are losing deposits of 2,000 million euros per week.
“The general feeling in the Eurogroup remains it would be best that the Greek authorities seek an extension of the program, “said Dijsselbloem. But the Greek Finance Minister, Yanis Varoufakis, replied that he hoped to seal a deal with creditors that would give extra credit to Athens for four to six months in exchange for putting on hold new budgetary policies. The minister was hopeful for the future. “I have no doubt that within the next 48 hours Europe will unite and find a way to express what is necessary for us to go ahead and do the work necessary,” said Varoufakis.
But what happened yesterday in Brussels goes in the opposite direction: the talks, expected to last until late at night, collapsed in less than four hours. The two sides showed signs of having little patience, with many ministers fearing a disaster. Varoufakis said the European Commission presented a pose before the meeting, but was replaced by a different draft, written by Dijsselbloem, who could not sign because it forces Athens to extend its current bailout program. Dijsselbloem said the Greeks must gain time to discuss the next steps requesting an extension of the rescue force, which imposes strong adjustments. But he also said: “A new program would be very different I think not?”. Meanwhile, the office of Greek Prime Minister Alexis Tsipras, released a statement in which review blames the Eurogroup. The Eurogroup “unacceptable and inadmissible discussed a draft of an extension of the rescue,” so that “under these circum stances there can be an agreement today.” The Greek public television had already anticipated the lack of agreement.
European rejection. The German Finance Minister Wolfgang Schauble, a critic of the new Greek government said Greece had lived beyond their means for a long time and that in Europe there was like giving more money without collateral. Germany is the largest lender to Greece and its electorate has shown support for the hard line taken by the government of Angela Merkel. If an agreement is not achieved increases the risk that Greece is heading for a credit crunch could force her to leave the eurozone.
The Vice President of the European Commission, Valdis Dombrovskis stated that the Eurozone is ready to resume talks with Greece if you change your position. “He was clearly decided that, once you have a request to extend the rescue, if any commitments from the Greek authorities to stick to the program, then the president of the Eurogroup announced next meeting” of this he said, emphatically, Dombrovskis. For its part, the IMF stated that not disburse more funds to Greece if not progress with the required reforms
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