Thursday

2nd Apr 2020

EU rejects Greek calls for bailout summit

  • Tusk (l) with Tsipras in Athens in March. "We have to avoid a situation of renewed uncertainty for Greece," he said. (Photo: Consillium)

European Council president Donald Tusk has turned down a Greek request to organise an EU summit over the Greek bailout, but called for a Eurogroup meeting within days.

Tusk, who spoke to Greek prime minister Alexis Tsipras on Wednesday morning (27 April), said there was "still more work to be done by the ministers of finance".

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But he said that "a specific date for the new Eurogroup meeting" was needed.

"I am not talking about weeks but about days," he told journalists in Brussels.

"We have to avoid a situation of renewed uncertainty for Greece."

Tusk said his decision was taken after close consultation with Eurogroup president Jeroen Dijsselbloem and European Commission president Jean-Claude Juncker.

Tsipras was requesting a summit to talk about the bailout programme agreed last summer, as discussions to conclude the first review of the programme stalled on Tuesday.

EU leaders are wary of putting the Greek issue back on the top table. They did it last year when the risk of a Greek exit from the eurozone was felt to be real.

"We are not there yet," an EU source said Wednesday.

Greek officials and representatives from the quartet of lenders - the European Commission, the European Central Bank, the European Stability Mechanism and the International Monetary Fund (IMF) - failed to reach an agreement on so-called contingency measures.



The lenders want Greece to approve austerity measures that would be implemented if the country missed targets for the budget primary surplus (the surplus before the payment of interest on the public debt) set for 2018 by the bailout agreement.

The Greek government said approving such measures in advance would be unconstitutional and argued that the new austerity plan goes beyond what was agreed in last summer's bailout programme.

The contingency package was "a safeguard to ensure that if anything happens [with the bailout programme], we will have something to trigger to correct it", an EU source said on Wednesday.

Talks have so far stumbled on issues such as how to legislate the package, how to trigger it, according to what criteria, and whether specific measures or only a mechanism should be designed.

Greek government sources said the IMF was to blame because the fund rejected a Greek proposal to create a balancing mechanism instead of the adoption of a contingency package, according to Greek press agency ANA-MPA.

Greek finance minister Euclid Tsakalotos said on Tuesday that quartet officials needed to consult between themselves and with their political authorities.

'Hawks'

In addition to differences between Greece and the quartet, the different players within the quartet and member states within the eurozone differ on the scale and depths of the measures to be imposed on Greece.

The IMF and some EU states demand more cuts now in order to secure Greek finances in the long term and avoid a large debt relief package.

Other member states, and to some extent the European Commission, are more concerned about the risk of stifling a growth.

For these players, the contingency package should be designed to be used "when it is absolutely needed" and in a way that would not be damaging to the Greek economy, a source said.

Tsipras' call for a summit received support from the head of the socialist group in the European Parliament.

"We cannot ask Greece to take additional measures. This would mean that some 'hawks' want to kill Greece and we cannot allow this blackmail," Gianni Pittella said Wednesday.

"If the Eurogroup cannot find a way out, despite the efforts of the European Commission, then the political leadership of Europe should take the lead at an extraordinary euro summit next week.”

Meanwhile quartet officials remain in Athens to continue talks. A Eurogroup meeting next week to validate an agreement is “possible but not confirmed yet”, a source close to the Eurogroup told EUobserver.

“It depends on progress in the coming days.”

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