Facing default, Greece finds EU support as clock ticks
ATHENS, GREECE— A day ahead of a crucial emergency eurozone summit, European leaders renewed efforts to reach a deal between Greece and its creditors that would allow the debtridden country to avoid a default and a potentially disastrous exit from the euro. But time is running out. Frantic depositors were yanking more than € 1 billion a day from the country’s banks late last week, leading the European Central Bank on Friday to bolster the banking system on Friday for the second time in three days. Greek bankers say the banks will soon have to close if this uncertainty continues.
Greece is just about broke and must pay $1.8 billion (U.S.) to the International Monetary Fund by June 30. So far, it has refused European demands that it cut spending and amend its labour laws in return for a release of frozen funds.
On Sunday, Greek Prime Minister Alexis Tsipras had separate telephone conversations with French President François Hollande, German Chancellor Angela Merkel and European Commission President Jean-Claude Juncker, the prime minister’s press office said.
“(Tsipras) presented to the three leaders Greece’s proposal for a mutually beneficial agreement, which will provide a permanent solution and not just postpone tackling the problem,” the press office statement said.
Later, Hollande told reporters in Milan, where he met with Italian Premier Matteo Renzi, that everything must be done to keep financially ailing Greece in the eurozone.
“If the Greeks leave the eurozone, it won’t be positive for the Greeks or Europeans,” Hollande said.
“We need stability” especially since much of Europe is beginning to rebound economically, he added. “For this reason we must reach an accord.”
Renzi added that European leaders were working to have an agreement with Greece “in the next hours,” but didn’t provide any details.
Tsipras met with his senior ministers all day and was to leave for Brussels late Sunday. Talks between cash-strapped Greece and its creditors on the completion of an earlier bailout deal had already hit a snag before the January election of the anti-bailout, anti-austerity coalition government headed by the radical leftist Syriza party.
As a result, Greece has not received any bailout funds since summer 2014 and its ailing banking system is only kept afloat through a weekly infusion of emergency funds from the European Central Bank.
The new government’s radical approach — essentially denying the need for austerity measures, which it calls “recessionary” — has often stretched the talks in the past five months to the breaking point.
Now, the race is on to prevent the country’s default.
With both Greece and the creditors seemingly locked in a who-willblink-first contest, the battle is on to bridge the gaps and secure a deal.
The governing Syriza party held a rally in Athens Sunday in support of the government.
It comes after a strong rally on Thursday of those favouring a deal with the EU.
Syriza and similar leftist political groups organized “solidarity to Greece” rallies across Europe over the weekend or joined related protests, such as an anti-austerity march in Britain Saturday. With files from the New York Times