EUROZONE-GREECE/EUROGROUP ARRIVALS UPDATE EU finance ministers split over likelihood of Greece deal on Sunday

Record ID: 147500

  • Title: EUROZONE-GREECE/EUROGROUP ARRIVALS UPDATE EU finance ministers split over likelihood of Greece deal on Sunday
  • Date: 12th July 2015
  • Summary: BRUSSELS, BELGIUM (JULY 12, 2015) (REUTERS) PADOAN WALKING AWAY
  • Embargoed: 27th July 2015 13:00
  • Keywords:
  • Location: Belgium
  • Country: Belgium
  • Topics: General
  • Reuters ID: LVACC5O1YTYRNDKYADOMGVY3SC8K
  • Aspect Ratio: 16:9
  • Story Text: Eurozone finance ministers were divided on Sunday (July 12) over whether to grant Greece a third bailout programme.
    Their meeting was suspended on Saturday night after nine hours of acrimonious debate on Greece's application for a new loan on the basis of reform proposals Greek Prime Minister Alexis Tsipras accepted after long resisting.
    The ministers were set to prepare the ground for a meeting of eurozone leaders set to start at 4 p.m. (1400 GMT).
    A planned summit of all 28 EU leaders that was set to follow the eurozone summit and would have been needed in case of a "Grexit" was cancelled by European Council President Donald Tusk. Tusk said the eurozone summit would "last until we conclude talks on Greece".
    Several ministers including Italian Finance Minister Pier Carlo Padoan spoke about the lack of trust towards Greece and questioned the ability of Tsipras to implement a deal he had called voters to reject in a referendum a week ago.
    "The main obstacle to moving forward is lack of trust. So I would like to see the Greek government to take concrete actions starting tomorrow in parliament to implement measures that are needed for Greece in the first place and then to rebuild trust and therefore allow concrete negotiations to move forward. We have lost so much time, we cannot afford to lose more time anymore," Padoan said.
    The ministers agreed in principle to seek ways to ease Greece's debt burden by extending loan maturities and other steps stopping short of a "haircut" or writedown, provided Athens first implements key reforms of taxation, pensions, labour markets and public administration.
    EU Commissioner for economic and monetary affairs Pierre Moscovici was one of the more positive voice.
    "It is our hope that at the end of the day we have a good agreement that maintains the integrity of the euro and allows a reformed Greece to continuing progressing in the euro," Moscovici said.
    Several hardline countries, including Slovakia and Finland, voiced support for a German government paper that recommended Greece take a five-year "time-out" from the eurozone unless it accepted and implemented swiftly much tougher conditions, notably by locking state assets to be privatised in an independent trust to pay down debt.
    Slovakia's finance minister Peter Kazimir questioned whether the proposals went far enough and ruled out a deal today.
    "No, no, it is not possible to reach a deal today. We can (make) certain recommendations for the heads of state, that is all. The breach of trust is so vivid it is not possible to achieve the deal," Kazimir said.
    Greece has already had two bailouts worth 240 billion euros from eurozone countries and the International Monetary Fund, but its economy has shrunk by a quarter since the crisis began, unemployment has soared above 25 percent and one in two young people is out of work.
    Athens defaulted on an IMF loan repayment last month and faces state bankruptcy if it cannot make a bond redemption to the European Central Bank on July 20, which would likely force the ECB to cut emergency funding for Greek banks.
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