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Tags: greece | imf | talks | gambling | merkel

Greece Ordered to Stop Gambling With Its Future as Endgame Nears

Thursday, 11 June 2015 09:15 PM EDT

Greece was told to stop fighting creditors’ demands and sign a deal that will avert a default and exit from the euro.

Diplomatic niceties evaporated in Brussels as European Union President Donald Tusk rebuked Greek Prime Minister Alexis Tsipras for dragging his feet on a debt agreement and the International Monetary Fund’s team walked out of negotiations.

One official said after a four-hour meeting of EU government staffers that Greece was given less than 24 hours to come back with firm proposals to end the impasse.

“There is no more time for gambling,” Tusk told reporters in Brussels on Thursday. “The day is coming, I am afraid, that someone says the game is over.”

Standing on the brink of economic ruin, a reality check awaited Greece. The trio of lenders that hold the key to the country’s fate have run out of patience with what they see as delaying tactics and mixed messages of a leader elected to end an era of austerity.

“The ball is very much in Greece’s court,” IMF spokesman Gerry Rice told reporters in Washington. “There are major differences between us in most key areas. There has been no progress in narrowing these differences recently.”

Battle Lines

Battle lines were drawn at a working dinner of EU finance officials that aimed to lay down the groundwork ahead of a likely showdown next week when their bosses meet in Luxembourg. At the meeting, the Greek representative was told his government had to come with a serious action plan that includes pension and tax reform, according to two people familiar with the discussions speaking on condition of anonymity because the talks were private.

German Chancellor Angela Merkel, who held talks with Tsipras and French President Francois Hollande late Wednesday, also signaled that the Greek side has to compromise.

“The willingness is there to cooperate with the three institutions,” Merkel said, referring to the European Commission, the IMF and the European Central Bank.

“It’s now a matter of acting on that,” she added, arriving for a summit of European and Latin American leaders in Brussels earlier on Thursday.

Since coming to power in January, Tsipras’s government has frequently refused to meet with IMF officials, arguing that a deal should be brokered between politicians, according to a person familiar with the process. In a briefing last month to the IMF board, the fund’s European department director Poul Thomsen said that stance was impeding talk, the person said.

Merkel, Hollande

Merkel and Hollande huddled with Thomsen’s boss, Christine Lagarde, and ECB President Mario Draghi along with European Commission President Jean-Claude Juncker in Berlin on June 1 to thrash out a proposal for Greece. The plan was initially billed as a final offer though Juncker subsequently rowed back on that.

Greece put forward a counter-proposal that was dismissed as not credible by one official involved in the process.

“It’s important for the Greek government to not just communicate what they don’t want to do but to come up with alternative, credible proposals of what they want to do,” Commission Vice President Valdis Dombrovskis said in Madrid.

Creditors have previously given June 14 as the deadline for an accord that has to be approved by some national parliaments before the bailout expires at the end of June. Tusk moved that back further, saying the next gathering of euro-area finance ministers on June 18 would be decisive.

Greek Discontent

Tsipras will have to weigh an accord acceptable to lawmakers in Athens as economic conditions deteriorate in Europe’s most indebted nation. The unemployment rate in Greece rose to 26.6 percent in the first quarter, up from 26.1 percent in the preceding three months.

After digesting painful cuts to wages and pensions, the nation is divided on whether to bow to more sacrifices. In a Marc survey of 1,001 people conducted this week, 50 percent of respondents said Greece should surrender to the new conditions while 37 percent ask Tsipras to stand firm.

On the outside of the finance ministry in the center of Athens, the communist union PAME hung a five-story-high banner on Thursday. It pictured Tsipras alongside his predecessors George Papandreou and Antonis Samaras and three sinister figures with top hats and cigars, blaming them for accepting the demands of Greece’s creditors.

“We’ve bled enough, we’ve paid enough,” the banner said. “Give the issue back to the people, block the new measures, stop permanent memorandums.”

© Copyright 2023 Bloomberg News. All rights reserved.

Greece was told to stop fighting creditors' demands and sign a deal that will avert a default and exit from the euro. Diplomatic niceties evaporated in Brussels as European Union President Donald Tusk rebuked Greek Prime Minister Alexis Tsipras for dragging his feet on a...
greece, imf, talks, gambling, merkel
Thursday, 11 June 2015 09:15 PM
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