The eurozone had expected Athens to submit fresh reform plans on Tuesday after Greeks voted by 61 percent to reject creditor demands for more austerity in return fresh EU-IMF bailout funds in an unprecedented referendum.
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Newly appointed Greek Finance Minister Euclid Tsakalotos (R) is welcomed by Eurogroup President Jeroen Dijsselbloem (L) at a euro zone finance ministers meeting on the situation in Greece in Brussels, Belgium, July 7, 2015.
Greek Prime Minister Alexis Tsipras said Wednesday his government had made proposals involving “credible reforms”, United States of America Today reported.
Greek Prime Minister Alexis Tsipras arrives for an emergency meeting in Brussels on Tuesday.
Greece has been trying to persuade its 18 neighbors in the eurozone to cut Athens’ massive debt and hand it more bailout loans to keep the country from running out of cash and possibly becoming the first country to exit the eurozone in its 16-year history.
French Prime Minister Manuel Valls said the proposals were a step in the right direction and reiterated that keeping Greece in the eurozone was a “geopolitical issue of the highest importance”.
Russia, he said, is interested in a “strong, functioning, economically growing European Union”.
The beleaguered country will get one last chance to convince its creditors to loosen their purse strings or face the prospect of a default and financial oblivion.
As the rest of the globe holds its collective breath waiting for the economic dilemma in Greece to be resolved, the country’s politicians are involved in a marathon meeting that will determine its financial destiny. So far, Greece has only produced an outline of the measures.
But it infuriated other leaders and dealt a traumatic blow to the post-war vision of European integration, of which the single currency is a key part.
In a report last week, it said European states should accept longer repayment periods and lower interest rates on their loans to Greece. The euro also fell, while Greece’s stock market remained shut since last week amid the bank closures.
Greece’s eurozone partners have steadfastly said they want to help Greece stay in the currency club but have just as often complained about Greece dragging its feet during months of negotiations.
After a eurozone summit hours later, European Council President Donald Tusk urged the Greek government to specify its proposals for a comprehensive and specific reform agenda by Thursday at the latest. But to do that the opposition must recognize that austerity hasn’t worked in Greece, it has raised the debt.
Fears about food supplies in the next two or three weeks have mounted, businesses are unable to pay overseas for goods, and last-minute tourist reservations have plunged 30 percent, the Greek Tourism Confederation said.
Also on Wednesday, the European Central Bank made a decision to leave the limit on its stop-gap credit facility that has been providing emergency liquidity to Greek banks unchanged at 89 billion euros, a banking source said.
Tsakalotos – who replaced outspoken Yanis Varoufakis after he resigned on Monday to ease the rift with Athens’s creditors – told reporters there had been “progress” at Tuesday’s talks.
Securing a deal with creditors will almost certainly require Tsipras and his Coalition of the Radical Left, or Syriza, to capitulate to changes they have resisted since coming to power in January.
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Tsakalotos said in his letter he wanted to tap the ESM “to meet Greece’s debt obligations and to ensure stability of the financial system”.
