Greece and creditors fail in “last attempt” to reach deal
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Version 0 of 1. BRUSSELS — Talks on ending a deadlock between Greece and its international creditors broke up in failure Sunday, with European leaders venting their frustration as Athens stumbled closer toward a debt default that threatens its future in the euro zone. European Union officials blamed the collapse on Athens, saying it had failed to offer anything new to secure the funding it needs to repay $1.8 billion to the International Monetary Fund by the end of the month. Greece said it was still ready to talk but that E.U. and IMF officials had said they were not authorized to negotiate further. Athens insists it will never give in to demands for more pension and wage cuts. Athens faces immediate problems in repaying its debts because the E.U. and IMF have not paid any money from Greece’s bailout programs since the middle of last year. On top of the IMF loan, Athens must repay 6.7 billion euros when Greek bonds held by the European Central Bank fall due in July and August. Even if this short-term hurdle can be overcome, Greece still faces the daunting prospect of eventually repaying the bailout loans — something that will hang over its enfeebled economy for decades unless a relief deal is achieved. Both sides acknowledged that the talks had lasted less than an hour, although even here accounts differed: Greece put the duration at 45 minutes, E.U. officials at half an hour. Following what it called a “last attempt” at a solution, the E.U.’s executive commission said euro-zone finance ministers would tackle the issue when they meet Thursday. With no technical deal apparently possible, the ministers are likely to have to make difficult political decisions on Greece’s membership of the currency bloc. Failure to keep Greece in the euro zone, after years of arduous negotiations and two emergency bailouts totaling 240 billion euros, would send it lurching into the unknown and mark a historic blow to the E.U.’s most ambitious project. On Friday, Greek Prime Minister Alexis Tsipras indicated that he would accept painful compromises on demands for austerity and reform in return for debt relief. But the commission said after the talks, which also involved the ECB, that “the Greek proposals remain incomplete.” “While some progress was made, the talks did not succeed as there remains a significant gap between the plans of the Greek authorities and the joint requirements of commission, ECB and IMF,” it said. These amounted to as much as 2 billion euros a year in permanent budget savings. E.U. officials said Athens had moved closer to the lenders on the size of Greece’s primary surplus — the budget balance before its debt repayments — but had not said how it intended to achieve this. Otherwise, the Greek delegation, led by Deputy Prime Minister Yannis Dragasakis, had offered nothing new, they added. Dragasakis said the Greek delegation remained ready to resume talks but blamed European lenders for insisting on pension cuts and value-added tax hikes to close the projected budget gap. — Reuters |