Wednesday 29 March 2017

Greek Prime Minister says agreement in sight on debt crisis

European Commission President Jean-Claude Juncker, right, speaks with Greek Prime Minister Alexis Tsipras as they arrive for a meeting at EU headquarters in Brussels on Wednesday, June 3, 2015. (AP Photo/Virginia Mayo)
European Commission President Jean-Claude Juncker, right, speaks with Greek Prime Minister Alexis Tsipras as they arrive for a meeting at EU headquarters in Brussels on Wednesday, June 3, 2015. (AP Photo/Virginia Mayo)

Greek Prime Minister Alexis Tsipras emerged from late-night talks with senior EU officials in Brussels saying a deal with creditors was "within sight" and that Athens would make a payment due to the IMF on Friday.

But while the European Commission said "progress was made in understanding each other's positions", the leftist-led Greek government still rejects benefit cuts and tax rises its EU and IMF creditors want before they release fresh loans to avert a bankruptcy that could disrupt the euro zone and world markets.

Commission President Jean-Claude Juncker, who hosted Tsipras for a late dinner at the EU executive's headquarters along with the chair of euro zone finance ministers Jeroen Dijsselbloem, would reconvene their meeting in the coming days, officials said after the talks broke up in the early hours of Sunday.

With Europe's big powers - and the United States - concerned about the unpredictable effects of negotiations dragging on while Greek reserves shrink towards zero, creditors signalled a will to compromise, notably by lowering how much surplus they want a new budget to generate to service Athens debts.

But as Tsipras's party battles to retain support from voters who elected in January to end years of austerity, its spokesman in parliament renewed tough rhetoric at home. Nikos Filis told a Greek broadcaster the government would not sign any "ultimatum" and would rather hold a new election if forced into a corner.

Tsipras is balancing a hardline faction in his party that is keen to spend Greece back towards economic growth with impatient lenders in the rest of the euro zone and the wish of a large majority of Greeks not to be forced to give up the EU currency.

Hours after Syriza party spokesman Filis warned that Greece might not repay the €300m in International Monetary Fund loans that fall due on Friday if a deal was not at hand, a smiling Tsipras gave assurances in Brussels that Athens would continue to honour its commitments.

"Don't worry about it," he told reporters. "We have already paid 7.5 billion, so we will continue."

Of the negotiations, he reprised the positive tone he has taken since he secured a four-month extension of a bailout package in February: "I believe an agreement is in sight," he said. "But we need to conclude the discussions with a realistic point of view," he added, making clear his reservations.

Referring to what negotiators say have been reductions in the targets creditors are setting for Greece's primary budget surplus - what it has left from other expenses to fund its debts - Tsipras said: "We are very close to an agreement on the primary surplus. That means all sides agree to go further without tough austerity measures of the past."

Reuters

Promoted articles

Also in Business