EU Officials Are Prepared for Grexit
BRUSSELS — The latest on the Greek financial crisis (all times Brussels local):
___
12:25 a.m.
European
Commission President Jean-Claude Juncker says authorities are prepared
for all eventualities in Brussels' drawn-out negotiations with Greece
about its financial crisis — including a scenario in which debt-laden
Greece leaves the euro single currency or the European Union itself.
"The
commission is prepared for everything. We have a Grexit scenario,
prepared in detail," Juncker said after an emergency eurozone summit
wrapped up with leaders giving Greece until Thursday to submit detailed
reform proposals that could form the basis of a new bailout.
Juncker did not elaborate on what exactly he meant by the term Grexit.
He
says the commission also has plans in case Greece needs humanitarian
aid and, what Juncker called his favorite option, "a scenario how to
deal with the problem now keeping Greece as a member of the euro area."
___
11:55 p.m.
French
President Francois Hollande says Greece still needs to make "credible
and serious proposals" that prove it wants to remain part of the
19-nation eurozone.
Latest Updates
The French leader spoke to reporters late Tuesday after an inconclusive summit meeting of nations using the euro.
Greek
Prime Minister Alexis Tsipras earlier said his government had submitted
proposals, but it was unclear whether it meant anything more than the
general direction of staving off too tough austerity and insisting on
debt restructuring.
Respecting the rules, Hollande said, "is a condition of living together."
"What's
at stake is to know the place of Greece in the European Union and thus
the eurozone," Hollande said. "Today, there is no more time to waste."
___
11:41 p.m.
Greek
Prime Minister Alexis Tsipras says his government has submitted a
proposal for an agreement to the eurogroup and to the European Council.
Tsipras
said Tuesday the proposal was what had been formulated as a national
strategy by a political leaders' meeting in Athens, but didn't specify
if it was a written or verbal proposal.
He
said it contains "credible reforms that are socially just and include
in reciprocity a commitment to cover the country's financial needs in
the medium term, a strong investment package to counter big problems
such as unemployment, as well as the start of substantial talks and the
restructuring of debt."
He
said the discussion with other eurozone leaders Tuesday "took place in a
positive climate" and said he expects the process to reach an agreement
will be speedy.
"It will begin in the next few hours with the aim of concluding until the end of the week at the latest," he said.
___
11:20 p.m.
Italy's prime minister doesn't just want to keep Greece in Europe. He has a far bigger target: Europe itself.
Matteo
Renzi said Tuesday that if it can save struggling Greece from plunging
out of the euro single currency this week, the 28-nation European Union
then needs to start investing in its own future.
"We have not only the emergency in Greece, we have a very incredible problem about Europe," Renzi said.
He
said it is now time to "invest in a different vision of Europe, invest
in a different idea of Europe, in a Europe focused on growth and not
just austerity."
___
11:10 p.m.
European
Union President Donald Tusk says the protracted negotiations to keep
Greece from financial collapse and in the eurozone "is maybe the most
critical moment in our history."
After
calling for the emergency summit in the wake of Sunday's Greek "no"
vote to proposals from its eurozone partners, Tusk said the 19 leaders
agreed to give Prime Minister Alexis Tsipras one final shot to keep his
nation afloat with the aid of his allies sharing the euro currency.
"I have to say it loud and clear the final deadline ends this week," he said.
On Sunday, the 28 leaders of the full European Union will meet to assess Greece's final proposals.
___
10:35 p.m.
Eurozone
leaders have given Greek Prime Minister Alexis Tsipras until Sunday to
come up with a full proposal at a summit of the 28 European Union
leaders, Italian Premier Matteo Renzi says.
Renzi
said that Tsipras has all interest in coming up with a sensible
proposal to stave off financial chaos in Greece and said that "I think
that in the end we have an agreement."
___
9:35 p.m.
Greece's
deputy finance minister said tax revenues have not suffered as much as
expected during the bank closures, allowing the state to cover domestic
costs this month.
"It
was a positive surprise ... Taxes are doing well, not at the level we
had expected before all this happened, but not far off," Deputy Finance
Minister Dimitris Mardas told state television.
Many
Greeks with the ability to pay have attempted to settle taxes, loan
payments and other costs, such as school fees, over the past 10 days
since they have worried the money could disappear from their accounts
anyway if the government would be forced to raid deposits to prevent a
banking collapse.
Mardas
said the government was "not currently considering" the measure and
hoped to "gradually" restore bank operations and services, without
giving further details.
___
7:10 p.m.
A Greek official has conceded that the country's banks are unlikely to reopen this week despite an earlier pledge to do so.
George
Katrougalos, a minister for administrative reform, told a radio station
Tuesday in Athens that a decision must be made to reopen the banks, but
"that's probably is not technically possible this week."
The government announced bank closures and withdrawal restrictions June 28 and extended them through Wednesday.
A
cash shortage is looming, however, as Greeks and tourists drain as much
cash as they can from ATMs. The European Central Bank refused Monday to
increase the amount of credit that Greek banks can draw on.
___
6:50 p.m.
The White House says President Barack Obama and Greek Prime Minister Alexis Tsipras spoke by phone Tuesday morning.
It's
the first known phone call between the two leaders since the weekend
referendum in which Greece rejected creditor proposals that included
more austerity measures.
The
White House has said it's in Europe's interest to reach a resolution
that puts Greece on the path toward economic growth and stability.
___
5:55 p.m.
Dutch
Prime Minister Mark Rutte's message to the Greeks was blunt as he
arrived at an emergency eurozone summit in Brussels: We can only help
you if you want to be helped.
Rutte,
a close ally of German Chancellor Angela Merkel, told reporters Tuesday
he was "extremely somber about this summit. I'm also somber about the
question of whether Greece really wants to come up with proposals, with a
solution."
Rutte
refused to say if a Grexit — a Greek exit from using the euro currency —
was looming. But he said he was at the summit not only for Greece but
also for the euro currency used by 19 of the European Union's 28
nations.
"I
am at the table here today to ensure that the integrity, the cohesion,
the underlying principles of the single currency are protected," he
said. "And it is really up to the Greek government to come up with
far-reaching proposals. If they don't do that, then I think it will be
over quickly."
___
5:20 p.m.
The
eurozone's top official says Greece would make a proposal to tap
Europe's bailout fund, the European Stability Mechanism, as soon as
Wednesday.
Following
the conclusion of the meeting of the eurozone's 19 finance ministers,
Jeroen Dijsselbloem confirmed that the new Greek finance minister,
Euclid Tsakalotos, did not deliver any fresh written proposals for a
bailout deal that would help the country avoid falling out of the euro.
Dijsselbloem said he "broadly agreed" that Greece needs more than a short-term financial fix.
"The
ministers also broadly agreed that if there is to be another ESM
program with support it would have to be a medium term program for
reasons of credibility," he said.
The
eurozone, he added, would first have to assess the financial situation
in Greece before deciding to start talks on a possible new aid program.
__
5:05 p.m.
Fidel Castro is backing Greek Prime Minister Alexis Tsipras as he tries to win concessions with creditors.
Cuban state media are carrying the text of a letter he wrote to Tsipras.
The
retired Cuban leader compliments Tsipras on what he calls his
"brilliant political victory" — an apparent reference to the
overwhelming victory of the 'no' campaign in Sunday's Greek referendum
on creditor proposals.
Castro
praises Greece's historical contributions to philosophy, art, science
and politics, as well as its resistance to Axis military powers during
World War II.
"Your
country, especially your courage in the current moment, awakens
admiration among the Latin American and Caribbean peoples of this
hemisphere upon seeing how Greece, facing external aggressions, defends
its identity and culture," Castro writes.
The letter was dated July 5 and featured on the front page of official newspapers Tuesday.
___
5:00 p.m.
Russia
is pouring cold water on the prospect that the so-called BRICS nations
could help Greece financially at their summit this week.
Russian
Economic Development Minister Alexei Ulyukaev told Russian media that
the idea of providing any financial help to a non-BRICS member such as
Greece is "premature and, it seems to me, not current."
The leaders of the BRICS countries — Brazil, Russia, India, China and South Africa — are due to meet in Russia this week.
Ulyukaev was speaking after a meeting of economic and trade ministers from the BRICS countries.
___
4.45 p.m.
The
meeting of the 19 eurozone finance ministers has ended and the body's
top official, Jeroen Dijsselbloem, is due to issue a statement shortly
about the discussions that centered on the Greek crisis. A number of
finance ministers left the meeting without speaking to reporters.
__
3:50 p.m.
Three
people familiar with discussions currently taking place between Greece
and its creditors in the 19-country eurozone say new Greek Finance
Minister Euclid Tsakalotos has not presented fresh written proposals
over how to win support for a financial bailout.
The
three eurozone sources, who spoke on condition of anonymity because of
the sensitivity of the negotiations, said Tsakalotos gave an oral update
of the financial situation in Greece instead. He had been widely tipped
to present reform proposals in written form.
No further details were available.
Prime
Minister Alexis Tsipras is expected to arrive at an emergency summit of
eurozone leaders later as his country struggles to forge a bailout deal
that would ease the pressure on the country's shuttered banks and
prevent a Greek exit from the euro.
__ By Raf Casert in Brussels
___
2:30 p.m.
Irish
Finance Minister Michael Noonan says Greece should do something
relatively simple to turn things around. Take a look at his nation.
Arriving
at an emergency meeting of eurozone finance ministers to discuss the
Greek crisis, Noonan said Ireland was also able to work with its debt
load to make it more manageable, He suggested Greece could also come
forward with debt proposals, even if they would be different from
Ireland's.
"There is not a one size fits all that we are looking at," he said.
For many, Ireland is the poster child of the austerity prescription laid out by bailout creditors over the past few years.
Ireland is forecast to post the strongest economic growth in the 28-nation EU this year.
___
2:10 p.m.
Finnish
Finance Minister Alexander Stubb has summed up just what is on the line
financially for his small country in the Greek negotiations — a
whopping 10 percent of Finland's annual budget.
On
his way into a meeting with his peers in the 19-country eurozone, Stubb
said Greece owes Finland 5 billion euros — a big dent in its budget of
50 billion.
It's also equivalent to 2.5 percent of Finland's annual GDP, he said.
"So a lot is obviously at stake," he said.
Stubb
says the meeting is not aimed at kicking Greece out of the euro, but
that it's up to Greece's leaders to come up with credible proposals to
secure a bailout deal.
"We
need to see some political will, a change of attitude on the part of
the Greek government in order for this to work," Stubb says.
___
1:50 p.m.
Lithuania
only started using the euro currency this year and doesn't want the
19-country single currency club to start losing members now.
Lithuanian
Finance Minister Rimantas Sadzius said a Greek exit "is not an option
for us," as arrived for the meeting of eurozone finance ministers in
Brussels to discuss a possible new bailout deal for Athens.
Sadzius
said he believes common ground can be found. Greece's new finance,
Euclid Tsakalotos is set to unveil new proposals to his peers in the
eurozone.
"In
politics, there is always room for compromise," said Sadzius. "We
believe that the eurozone should expand rather than contract."
___
1:30 p.m.
German
Finance Minister Wolfgang Schaeuble says Berlin still opposes an actual
debt cut for Greece as he arrived at a meeting with his counterparts in
the 19-country eurozone.
Schaeuble
said he's waiting with interest to hear the ideas of the Greek
government but stressed that without an aid program, there is "no
possibility to help Greece within the framework of the eurozone."
Germany
is reluctant to consider a debt cut for Greece. The Greek government
wants debt relief for the country to be near the top of bailout
discussions. That doesn't necessarily mean an actual reduction in the
amount owed — it could take the form of extending the country's
repayment schedule.
Schaeuble said actual debt cuts are banned under European rules.
___
1:05 p.m.
Jeroen
Dijsselbloem, the eurozone's top official, says the pressure is on
Greece to come up with fresh economic proposals that meet the
requirements of its partners in the single currency bloc.
Arriving
for talks with his peers in the 19-country eurozone, Dijsselbloem said
the Greek government has "a major interest" in bringing forward "serious
and credible" proposals that are needed if Greece is to get another
bailout.
Greece is running out of time to secure a deal that will help its banks reopen and avoid a disorderly euro exit.
The
eurogroup president also said the resignation of Yanis Varoufakis,
Greece's outspoken finance minister over the past few months of the
protracted bailout discussions, would not necessarily make a difference.
Varoufakis has been replaced by the more mild-mannered Euclid
Tsakalotos.
"It is not about persons," Dijsselbloem said. "It is about where we stand after the 'no' referendum."
___
12:45 p.m.
If
new Greek Finance Minister Euclid Tsakalotos has revised proposals for a
fresh bailout of his debt-ridden nation to show his peers in the
19-country eurozone, he was keeping them close to his chest as he
arrived for talks in Brussels.
A
day after being sworn in to replace Yanis Varoufakis, who quit after
Sunday's referendum 'no' vote, Tsakalotos hurried into the meeting venue
without speaking to reporters.
On Monday, he conceded: "I won't hide from you that I am very nervous and very anxious."
And
in something of an understatement, Tsakalotos said after being sworn
in, "I am not taking over at the easiest moment in Greek history."
___
12:10 p.m.
Dutch
State Secretary for Finance Eric Wiebes says Greek representatives need
to come up with a serious package at the meeting of eurozone finance
ministers if fresh bailout talks are to make any progress.
"I
hope they bring a very serious proposal in their luggage," Wiebes said
as he arrived an hour early for the start of the meeting in Brussels.
"Because it is only worth continuing to talk on the basis of a very
serious proposal. I can't imagine the proposal would be less serious
than the proposal that was already on the table."
Wiebes,
a junior Dutch minister, attends the eurogroup meetings because Dutch
Finance Minister Jeroen Dijsselbloem is the group's chairman.
The
Greek government is expected to make fresh proposals at the meeting in
order to secure a bailout deal so it avoids leaving the euro.
__
11:55 a.m.
Rarely, if ever, has any leader gone to Brussels for a summit with as much as stake as Greek Prime Minister Alexis Tsipras.
With
his country on its economic knees and facing the prospect of a
disorderly exit from the euro, Tsipras knows that Greece's future for
years if not decades could hinge on how talks later pan out.
Neil MacKinnon, global macro strategist at VTB Capital, spelled out what's at stake.
"The
Greek economy is in danger not just of imploding but of falling into a
nightmarish dysfunctionality where what we consider as the normal
economic functions of society collapse," he said. "This is a recipe for
anarchy and social disorder."
___
11:10 a.m.
While
Europe's leaders headed for Brussels for what could be a make-or-break
summit for Greece's future in the euro, Greeks continued to struggle
with the strict controls on their bank withdrawals.
Amid
signs that the banks were fast running out of cash, there are growing
concerns about what will happen to people's savings. Banks have been
shuttered for over a week and cash withdrawals have been limited to 60
euros a day.
Giorgos
Stathopoulos, a 46-year-old civil servant said many ATMs had run out of
20-euro notes, effectively reducing the daily limit to 50 euros.
"The problem is for those of us who don't have big deposits, what happens with our savings, that is the concern," he said.
And Giorgos Kafkaris, a 77-year-old pensioner, is hopeful about improvements. "I believe something better will happen," he said.
___
9:35 a.m.
European
Commission President Jean-Claude Juncker has tempered expectations of a
swift solution to the Greek crisis, saying "a solution is not going to
appear overnight."
Juncker
told lawmakers at the European Parliament in Strasbourg that any
solution later at a meeting of the eurozone's 19 leaders in Brussels
would likely be "overly simplistic."
He
said one of the purposes later is to "restore order to the situation."
He also displayed his anger at attacks on the European Union's executive
branch.
"I think it is unacceptable for the European Commission to be deemed terrorists by the Greek government," he added.
Greek
Prime Minister Alexis Tsipras and new finance minister Euclid
Tsakalotos are on their way to Brussels for meetings aimed at restarting
bailout talks.
"Quite clearly the ball lies in the court of the Greek government," said Juncker.
___
9:10 a.m.
European
stock markets have opened solidly ahead of an emergency meeting of
eurozone leaders in Brussels, where Greek Prime Minister Alexis Tsipras
is expected to reveal fresh proposals to the country's creditors.
Germany's DAX index was up 0.4 percent while the Stoxx 50 index of leading European shares rose 0.2 percent.
With
Greece's banks shuttered and cash reserves run dry, time is running out
for a bailout deal. Some investors hope the resignation of Yanis
Varoufakis on Monday may well help smooth discussions.
Still, few are optimistic and many analysts think that a Greek exit from the euro remains possible.
"It
seems untenable that Greece can slide out of the Eurozone with barely a
whimper being heard in financial markets, but right now that's what it
looks like," said Tony Cross, market analyst at Trustnet Direct.
___
8:19 a.m.
French
Prime Minister Manuel Valls says his country will do everything
possible to keep Greece in the eurozone, saying its exit would be a
"risk for global economic growth."
In
an interview with the RTL radio network Tuesday, Valls denied that
Greece's "no" vote was a rejection of Europe or its values but rather an
expression of pride. He called on Greece's prime minister to put
forward a plan and said France would be open to rescheduling Greece's
debt.
Valls says: "The eurozone must stay coherent, reliable. Europe is not just a currency. It is a conception of the world."
Greek Prime Minister Alexis Tsipras is headed Tuesday to Brussels to negotiate a rescue deal with European lenders.
No comments:
Post a Comment