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| Greek leader prepares to confront eurozone creditors as crisis nears climax | Greek leader prepares to confront eurozone creditors as crisis nears climax |
| (35 minutes later) | |
| Alexis Tsipras, Greece’s prime minister, is to confront his eurozone creditors in Brussels on Wednesday evening over the terms of his country remaining in the single currency, as the five-year crisis centred on debt and democracy moved towards a climax. | |
| Tsipras will join the president of the European commission, Jean-Claude Juncker, for dinner and a battle of wills over conflicting ideas for resolving Greece’s financial catastrophe, although many believe the best they are likely to agree is a fix to buy more time. | Tsipras will join the president of the European commission, Jean-Claude Juncker, for dinner and a battle of wills over conflicting ideas for resolving Greece’s financial catastrophe, although many believe the best they are likely to agree is a fix to buy more time. |
| Tsipras is attending to argue for acceptance of a 47-page reform programme he has handed to creditors this week. Juncker is charged with presenting him with a quite different blueprint drafted following an emergency summit of national and international leaders in Berlin on Monday evening. | Tsipras is attending to argue for acceptance of a 47-page reform programme he has handed to creditors this week. Juncker is charged with presenting him with a quite different blueprint drafted following an emergency summit of national and international leaders in Berlin on Monday evening. |
| “I am certain Europe’s leadership will see reason,” said Tsipras. “It is more essential than ever for the institutions and the political leadership of Europe to accede to the realism with which the [Greek] government has been moving for the past three months. We have to avoid division.” | “I am certain Europe’s leadership will see reason,” said Tsipras. “It is more essential than ever for the institutions and the political leadership of Europe to accede to the realism with which the [Greek] government has been moving for the past three months. We have to avoid division.” |
| The commission was playing down expectations of any quick breakthrough. “No final outcome expected,” said a spokeswoman for Juncker. | The commission was playing down expectations of any quick breakthrough. “No final outcome expected,” said a spokeswoman for Juncker. |
| In a week of hastily called summits, emergency drafting of positions and demands, and a cacophony of voices from the leading players saying utterly different things, it is not clear whether Tsipras will be able to clinch a deal with his European and International Monetary Fund creditors. | In a week of hastily called summits, emergency drafting of positions and demands, and a cacophony of voices from the leading players saying utterly different things, it is not clear whether Tsipras will be able to clinch a deal with his European and International Monetary Fund creditors. |
| The high-stakes negotiations could collapse through intransigence on both sides or, perhaps more likely, result in a time-buying pact that would resolve little of substance. It would, however, pull Greece back from the brink of insolvency, default and possible ejection from the eurozone. | The high-stakes negotiations could collapse through intransigence on both sides or, perhaps more likely, result in a time-buying pact that would resolve little of substance. It would, however, pull Greece back from the brink of insolvency, default and possible ejection from the eurozone. |
| Following a mini summit on Monday of German, French, IMF and European Central Bank (ECB) leaders in Berlin, the creditors tabled a stiff set of demands that Greece would need to meet to secure the €7.2bn remaining in bailout funds for now. | Following a mini summit on Monday of German, French, IMF and European Central Bank (ECB) leaders in Berlin, the creditors tabled a stiff set of demands that Greece would need to meet to secure the €7.2bn remaining in bailout funds for now. |
| Pessimistic that Greece can meet the terms or put its soaring sovereign debt trajectory on a sustainable path, the IMF has been pressing the Europeans to discreetly countenance a restructuring or writedown of Greek debt. It appeared that effort had failed, for now, leaving Tsipras with extremely tough choices - accept the stiff austerity terms and face a different confrontation with rejectionist hardliners in his far left Syriza movement at home, or reject the terms and call Europe’s bluff over allowing a country to fall out of the single currency. | Pessimistic that Greece can meet the terms or put its soaring sovereign debt trajectory on a sustainable path, the IMF has been pressing the Europeans to discreetly countenance a restructuring or writedown of Greek debt. It appeared that effort had failed, for now, leaving Tsipras with extremely tough choices - accept the stiff austerity terms and face a different confrontation with rejectionist hardliners in his far left Syriza movement at home, or reject the terms and call Europe’s bluff over allowing a country to fall out of the single currency. |
| The French president, François Hollande, and the Spanish finance minister, Luis de Guindos, said they were confident an agreement would be reached, if not on Wednesday then before Friday, when Greece is due to repay €300m to the IMF, the first of four payments this month. | The French president, François Hollande, and the Spanish finance minister, Luis de Guindos, said they were confident an agreement would be reached, if not on Wednesday then before Friday, when Greece is due to repay €300m to the IMF, the first of four payments this month. |
| Germany’s finance minister, Wolfgang Schäeuble, and the head of the Eurogroup of eurozone finance minister, Jeroen Dijsselbloem of the Netherlands, voiced pessimism that a deal would be struck. The latter was expected to join Wednesday evening’s dinner. | Germany’s finance minister, Wolfgang Schäeuble, and the head of the Eurogroup of eurozone finance minister, Jeroen Dijsselbloem of the Netherlands, voiced pessimism that a deal would be struck. The latter was expected to join Wednesday evening’s dinner. |
| Mario Draghi, president of the ECB, said the priority need was for a “strong agreement”, criticising what he sees as feeble proposals from the Tsipras government since it came to power in January on a ticket to reverse eurozone-dictated austerity and recast the bailout terms. | Mario Draghi, president of the ECB, said the priority need was for a “strong agreement”, criticising what he sees as feeble proposals from the Tsipras government since it came to power in January on a ticket to reverse eurozone-dictated austerity and recast the bailout terms. |
| Draghi said he would not relax the ECB ceilings allowing Greek banks to provide a lifeline by lending the government money unless the creditors are able to start disbursing the remaining loans, meaning no more mercy from the ECB unless Tsipras accepted the eurozone’s terms. | Draghi said he would not relax the ECB ceilings allowing Greek banks to provide a lifeline by lending the government money unless the creditors are able to start disbursing the remaining loans, meaning no more mercy from the ECB unless Tsipras accepted the eurozone’s terms. |
| Both sides appear desperate for a deal. And both sides appear unable to make the concessions needed to facilitate the agreement as they have quite different aims and cannot agree on the end, nor in the means to that end. | Both sides appear desperate for a deal. And both sides appear unable to make the concessions needed to facilitate the agreement as they have quite different aims and cannot agree on the end, nor in the means to that end. |
| Tsipras has been calling on the eurozone to respect the anti-austerity mandate he received from the Greek electorate. Schäeuble and Marc Rutte, the Dutch prime minister, accused him of making promises that he could not keep to get himself elected. | Tsipras has been calling on the eurozone to respect the anti-austerity mandate he received from the Greek electorate. Schäeuble and Marc Rutte, the Dutch prime minister, accused him of making promises that he could not keep to get himself elected. |
| The current bailout expires at the end of the month. It will need to be followed by further negotiations on a third rescue package for Greece. Tsipras has been trying for months to roll both packages into one. The Germans and most others insist the terms of the current bailout must be met before a follow-up deal can be contemplated. | The current bailout expires at the end of the month. It will need to be followed by further negotiations on a third rescue package for Greece. Tsipras has been trying for months to roll both packages into one. The Germans and most others insist the terms of the current bailout must be met before a follow-up deal can be contemplated. |
| Crucial to the financial arithmetic is the dispute over setting Greece’s primary budget surplus, the positive balance of revenue over spending after debt servicing costs are stripped out. | Crucial to the financial arithmetic is the dispute over setting Greece’s primary budget surplus, the positive balance of revenue over spending after debt servicing costs are stripped out. |
| Tspiras is seeking to minimise the primary surplus to give himself more room for spending. The creditors want to set a higher surplus, entrenching more austerity. | Tspiras is seeking to minimise the primary surplus to give himself more room for spending. The creditors want to set a higher surplus, entrenching more austerity. |
| Tsipras’ case was buttressed on Wednesday when the Organisation for Economic Cooperation and Development issued dismal forecast figures for the Greek economy this year. It reported no growth, higher unemployment and a debt level rising further to 180% of gross domestic product. | Tsipras’ case was buttressed on Wednesday when the Organisation for Economic Cooperation and Development issued dismal forecast figures for the Greek economy this year. It reported no growth, higher unemployment and a debt level rising further to 180% of gross domestic product. |
| Ahead of Wednesday evening’s dinner, Tsipras spoke by phone to the German and French leaders, Angela Merkel and Hollande. According to French reports, they told him that the eurozone was not presenting an ultimatum and that the proposals remained negotiable. | Ahead of Wednesday evening’s dinner, Tsipras spoke by phone to the German and French leaders, Angela Merkel and Hollande. According to French reports, they told him that the eurozone was not presenting an ultimatum and that the proposals remained negotiable. |