PM: Issue could go to summit
Tsipras says Greek case will be raised at EU leaders meeting if there is no acceptable offer at Eurogroup
Prime Minister Alexis Tsipras appeared determined yesterday to seek a solution to the Greek debt issue at a European Union leaders’ summit later this month if Greece doesn’t receive an acceptable concrete proposal at tomorrow’s meeting of finance ministers in Luxembourg.
“If this solution is not achieved and we get the same proposal as the last Eurogroup, then my proposal is that we do not accept it...and go to the EU summit,” he told a cabinet meeting yesterday.
Tsipras’s decision to raise the issue at the EU summit if there is no progress tomorrow, marks a turnaround from up to just a couple of days ago, when the goverment’s strategy was to clinch a deal at the Eurogroup at all costs.
The premier’s aides reiterated yesterday that Tsipras would accept the creation of mechanism like the one outlined by French Finance Minister Bruno Le Maire on Monday, which would link medium-term debt relief to Greece’s growth rates.
This would reportedly be an acceptable compromise for Athens as it could break the deadlock among the country’s international creditors over the country’s debt mountain.
Referring to the proposal by Le Maire, Tsipras told his cabinet yesterday that the “key is in accepting a proposal for a mechanism automatically linking medium-term debt measures with growth, bridging differences between institutions.” This compromise, he added, would make way for positive assessments about the debt’s sustainability.
Tomorrow’s Eurogroup is set to discuss the progress of reforms, ways to reduce debt and whether the International Monetary Fund will financially back Greece’s bailout.
However, any expectations that there will be a breakthrough tomorrow were dampened yesterday after a senior European official said he is confident there will be an agreement but this would fall short of Greek expectations. According to the official, the most Athens can expect is the release of a fresh bailout tranche, an agreement “in principle” that the IMF will join the Greek program and a clarification of what sort of debt relief measures are on the table. But these measures are not expected to differ from the ones at the previous Eurogroup, which Greece rejected. Moreover an agreement like the one described by the EU official will not pave the way for Greece to join the European Central Bank’s bond-buying scheme.
The main obstacle to a deal is the row between European institutions and the IMF over the sustainability of the Greek debt. And, the European official said, “we’re not there yet.”
Meanwhile, German Finance Wolfgang Schaeuble praised Finance Minister Euclid Tsakalotos at a conference organized by Bloomberg in Berlin. Schaeuble, who expects a compromise on Thursday, said Tsakalotos is an “exceptional” minister but does not enjoy enough of Tsipras’s confidence.