Wednesday 22 November 2017

Noonan backs Germans in bid for Greek deal

Greek Finance Minister Yanis Varoufakis, left, speaks with Finance Minister Michael Noonan
Greek Finance Minister Yanis Varoufakis, left, speaks with Finance Minister Michael Noonan
Michael Noonan
German Finance Minister Wolfgang Schaeuble
(L-R) German Chancellor Angela Merkel, International Monetary Fund (IMF) Managing Director Christine Lagarde, European Commission President Jean-Claude Juncker, European Central Bank President Mario Draghi, French President Francois Hollande and Greek Prime Minister Alexis Tsipras attend a Eurozone emergency summit on Greece in Brussels
Thomas Molloy

Thomas Molloy

Finance Minister Michael Noonan took a hard line on Greece as he clashed with the European Central Bank over the future of the troubled country at an inconclusive summit in Brussels yesterday.

Mr Noonan joined with his German counterpart Wolfgang Schaeuble to argue in a heated meeting that the ECB governing council could not keep meeting every day to approve emergency loans to Greece.

Mr Noonan is among those worried about what will happen if Greeks continue to withdraw vast amounts of cash from their saving accounts but a source said he stopped short of calling for controls on Greek banks.

The clashes came ahead of a summit of eurozone leaders last night to discuss Greek proposals to raise the pension age and VAT rates in return for financial concessions from other member states.

ECB officials reportedly told the Irish and German finance ministers to stay away from monetary policy, which is traditionally the preserve of central banks. Irish officials declined to comment.

Taoiseach Enda Kenny, who arrived late for the summit following problems with the Government jet, said a deal was unlikely until Thursday and warned that instability was causing hardship for ordinary Greeks.

Talks continued into the night but both Mr Kenny and Mr Noonan are likely to return to Brussels on Thursday for further meetings.

Mr Noonan said yesterday was the start of a process but chose to focus on the difficulties while some other finance ministers talked of the possibilities.

"There was such confusion during the night with alternative versions of the Greek proposal coming in that there hasn't been any preparation and it will be very difficult for the Eurogroup to have prepared for the meeting,' he said.

Many other finance ministers were equally cautious, saying they welcomed the Greek proposals for a cash-for-reform deal while adding it would take several days to determine whether they can lead to an agreement to avert a default.

Jeroen Dijsselbloem, chairman of the 19-nation Eurogroup, told a news conference: "We will work very hard in the next few days, the institutions with the Greek government, to get that deal this week."

Mr Dijsselbloem described the Greek document as comprehensive and "a basis to really restart the talks" but said it remained to be seen whether the numbers added up to make Athens's public finances sustainable.

Athens has to make a €1.6bn repayment to the IMF by June 30 or be declared in default, potentially triggering capital controls to stem a bank run and pushing Greece closer to the exit from the eurozone.

But after months of acrimony between Greece and its creditors, the positive mood music in Brussels injected new hope that an agreement might be near.

European shares surged and the Greek stock market jumped 8pc while the borrowing costs of Italy, Spain and Portugal - the countries most likely to be hit if Greece headed for a euro exit - fell sharply.

Chancellor Angela Merkel of Germany, the biggest European contributor to Greece's bailout programmes, held open the possibility of a deal.

"There are still a lot of days in the week in which decisions can be taken," she told reporters.

European Commission President Jean-Claude Juncker, a veteran EU dealmaker, gave Greek prime minister Alexis Tsipras a warm welcome, patting him on the cheek. This contrasted to earlier this month, when a frustrated Juncker rebuked Tsipras for failing to observe the "minimum rules" of friendship.

Greece's central bank chief last week warned lenders to brace for a "difficult day" today if yesterday's summit ended without a breakthrough. Despite the warning, there were no immediate long queues or panic outside Greek banks.

Government jet makes emergency landing

The government jet made an emergency landing at Casement Aerodrome in Baldonnel yesterday as the Taoiseach was making his way to Brussels for the crunch talks.

The flight had left Knock Airport but made the unscheduled landing at around 4.30pm when a cockpit light came on.

Mr Kenny and his officials disembarked and went for a cup of tea in the passenger terminal as maintenance work was carried out on the plane.

It is understood the problem related to the jet's thrust reverser, which is used to land. It was grounded for 48 minutes before taking off and continuing to Brussels.

Irish Independent

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