Greek PM agreed with Merkel, Hollande on need for quick deal- Greek official | Business News

Greek PM agreed with Merkel, Hollande on need for quick deal- Greek official

31 May 2015 | Author: | No comments yet »

Defiant Tsipras threatens to detonate European crisis rather than yield to creditor “monstrosity”.

Greece’s hopes of sealing an accord with its creditors by the end of May dimmed on Sunday, as disagreements between the two sides on budget targets persisted, a person familiar with the matter said. ATHENS – Greece’s Prime Minister Alexis Tsipras on Sunday attacked its creditors for insisting on what he described as absurd reforms which have only held up progress in negotiations for a deal aimed at preventing his country from defaulting.

Greek premier Alexis Tsipras has accused the Europe’s creditor powers of issuing “absurd demands” and come close to warning that his far-Left government will detonate a pan-European political and strategic crisis if pushed any further.ATHENS: Greece and its creditors were continuing talks on a cash-for-reforms deal but are expected to miss a self-imposed Sunday deadline for reaching an agreement to unlock aid, sources close to the talks said.This Sunday the Greek government is in talks with the troika, the Eurogroup, the ECB and the IMF , over the necessary bailout deal Greece needs if it is to avoid default. In a hard-hitting article for the French daily Le Monde, the leader lambasted the uncompromising approach of the EU, European Central Bank and International Monetary Fund for five months of fruitless negotiations. “The lack of an agreement so far is not due to the supposed intransigent, uncompromising and incomprehensible Greek stance,” he wrote. “It is due to the insistence of certain institutional actors on submitting absurd proposals and displaying a total indifference to the recent democratic choice of the Greek people.” The Greek leader held a telephone call on Sunday night with the German chancellor, Angela Merkel, and France’s François Hollande to discuss the situation. Writing for Le Monde in a tone of furious defiance after the latest set of talks reached an impasse, Mr Tsipras said the core powers were by degrees bringing about the “complete abolition of democracy in Europe” and were ushering in a technocratic monstrosity with powers to subjugate states that refuse to accept the “doctrines of extreme neoliberalism”. “For those countries that refuse to bow to the new authority, the solution will be simple: Harsh punishment.

Given that the next major cash crunch for the country is on Friday, when a repayment to the IMF becomes due, no one’s really quite sure whether there will be a deal or not. However, a deal has so far proved elusive as the creditors are demanding greater reforms in return for the cash, which Tsipras’s government — elected on an anti-austerity bill — has refused to match.

Tsipras’s intervention via La Monde – on the day when his anti-austerity coalition had hoped to wrap up talks – came amid clear signs of strain in the Syriza government as senior members of the radical left party denounced the appointment of the Greek-American economist Elena Panaritis as Greece’s representative at the IMF. The standoff over the terms attached to emergency loans has triggered a liquidity squeeze and record deposit withdrawals, tipping the economy back into recession. “The positive statements from Athens are necessary to mitigate the pressure on deposit outflows,” said Ricardo Garcia-Schildknecht, an economist at UBS AG. “Our baseline view remains an agreement, but negotiations are set to remain difficult, with more pressure probably needed.” With negotiations now in their fifth month, creditor institutions are seeking concrete action in areas including the pension system, labor market and sales tax. By Sunday night some 43 Syriza cadres, including deputy premier Yannis Dragasakis, had signed a petition opposing finance minister Yanis Varoufakis’s choice of Panaritis.

These include a special tax on the very wealthy, greater efforts towards clamping down on tax evasion, and putting broadcasting and other licenses up for tender. The words originally come from John Donne’s Meditation XVII, with its poignant reminder that the arrogant can be blind to their own ruin. “Perchance he for whom this bell tolls may be so ill, as that he knows not it tolls for him,” it reads. Taking a more conciliatory approach, Economy Minister Yiorgos Stathakis told a Greek daily the country’s only way forward was to make a deal with international creditors.

Varoufakis then told one follower that, as John Maynard Keynes put it, “in the long run we are all dead”, but “in the medium run, those nostalgic of the troika days are stuck with me @ FinMin”. Mr Tsipras’s article is a thinly disguised warning that Greece may choose to default on roughly €330bn of debt in the biggest sovereign default ever, and pull out of the euro, rather than breech it key red lines. The nation’s bonds delivered a 0.36 percent return in the last month, according to Bloomberg’s market-value weighted index of the country’s sovereign notes.

In an interview published in newspaper Corriere della Sera on Sunday, Greek Economy Minister George Stathakis said he expected a deal in “a few days”, followed by a meeting of euro zone finance ministers to approve disbursement of the aid. On Monday, Merkel and French President Francois Hollande will meet with European Commission President Jean-Claude Juncker for discussions on strengthening the eurozone as well as on the Greek crisis, the reports added. With just four weeks before a euro-area-backed bailout expires, Finance Ministry officials have told Greece there’s not time to get a disbursement approved by the currency bloc’s parliaments unless they reach at least a technical agreement by the beginning of June.

What the so-called optimism is about is stopping panic-stricken Greeks withdrawing deposits from banks,” said one well-placed source with access to high-level policymakers. “Time is not operating in the interests of the Greeks, but the EU. The article comes as Panagiotis Lafanzanis, the energy minister and head of Syriza’s powerful Left Platform, returns from Moscow after securing a provisional deal with Gazprom to build part of the “Turkish Stream” gas pipeline through Greece. In a sign of greater willingness to compromise, Interior Minister Nikos Voutsis said on Saturday that Greece was open to pushing back parts of its anti-austerity programme to reach a deal this week.

Everyone’s willing, or so it seems, to let things like the formerly required large primary surplus slide but they do want to be able to tell everyone that they have forced internal change upon the Greek economy. The Russian energy minister, Alexander Novak, said over the weekend that the project has been agreed in principle. ” We are now discussing technical details,” he said. Mr Lafanzanis said Greece is taking further steps to join the so-called BRICS bank, a multilateral lender created by Russia, Brazil, China, and South Africa. And the general Northern European assumption is that the Greeks retire on full pensions at 50, do no work when they still have a job and that the Northern Europeans are being forced into paying for all of this. It follows days of impassioned debates with the party, with a growing number of MPs berating Mr Tsipras for drawing out the agony by raiding local government and pension funds.

He told the BBC’s Andrew Marr show: “Sometimes I get the impression that people are waiting for an accident so that they can really focus [on] avoiding a bigger disaster. The matter has moved to a higher level and is at this point entirely political. “The decision is now not in the hands of the institutions, which in any case are not elected and are not accountable to the people, but rather in the hands of Europe’s leaders,” he said.

Bulldoze through those technical talks, delay until something, anything, must be done and then depend upon those power brokers to think that saving the euro, eurozone and ever closer European unity is more important than any silly details over pensions or labour law.

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