Biodun Iginla, BBC News

Biodun Iginla, BBC News

Tuesday, July 7, 2015

Greece debt crisis: 'No new plan' as eurozone leaders meet

by Isabelle Roussel and Biodun Iginla, BBC News Analysts, Athens/Brussels

32 minutes ago


The eurozone says Greece has submitted no new proposals to secure a deal with creditors ahead of a key meeting of the group's leaders which is now under way.
It had urged Greece to submit fresh plans after its people rejected a draft bailout in a referendum.
Greece said it had proposed a few changes and hoped to secure "a mutually beneficial agreement on the basis of the mandate of the referendum".
But Germany said there was "still no basis" for talks on a new bailout.
Greece debt crisis: Latest updates
The Greek side gave a presentation on Tuesday at a eurozone finance ministers' meeting in Brussels, which preceded the leaders' summit. However, there was no new written plan.
The Greek government said: "Today's Eurogroup was not supposed to take decisions but rather prepare for the summit."
Media caption German Chancellor Angela Merkel stresses that only days are left to secure a deal
It said proposals it had made last week were still on the table with a "few changes" and they would be discussed later on Tuesday and on Wednesday.
Mr Dijsselbloem said Greece would be sending a new letter requesting support from the European Stability Mechanism (ESM), a pot of money set up in 2012 to fund eurozone members in financial difficulties.
He said the Eurogroup would discuss this on Wednesday but that creditors would have to look at Greece's finances and debt sustainability to see "if we can formally start the negotiations".
Greek PM Alexis Tsipras met German Chancellor Angela Merkel and French President Francois Hollande separately before the leaders' summit.

Analysis: Gavin Lee, BBC News, Europe reporter

Greek Finance Minister Euclid Tsakalotos' accidentally revealed his notes on hotel paper on Tuesday
The first full day at work for Greek finance minister, Euclid Tsakalotos, and he's already found out what it's like to slip-up with the paparazzi. Mr Tsakalotos was photographed with scribbled notes in hand, face-side up - private notes now open to public scrutiny on social media.
The scribbled notes - written in English, conveniently for the press - may not be legible enough to make full sense of his opening gambit but they certainly reveal the tone. The words 'no triumphalism' can be deciphered, attention is drawn to 'AT' - presumably Alexis Tsipras' message on the night of the referendum, and there's also reference to the proposals being rejected "mostly on viability grounds".
Mr Tsakalotos then writes about yesterday's political deal with all parties except the communist KKE - perhaps to draw attention to the overwhelming mandate he believes the Greek government has.
There may be graphologists already studying his writing to get a sense of the man now a key player in determining the future of Greece. In the interim, Mr Tsakalotos may now be scribbling: "Note to self: keep cards close to chest."
Showing your notes: other notable gaffes
The result of the referendum had sparked fears of a Greek exit from the eurozone and the lack of a new written plan was criticised by some in the group.
Mrs Merkel said as she arrived for the leaders' summit: "We still do not have the basis for negotiations... it is not a question of weeks anymore, but a question of a few days."
Malta's Prime Minister Joseph Muscat said the leaders' summit was looking like a "waste of time".
His Dutch counterpart, Mark Rutte, said: "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."
Mr Hollande and Italian Prime Minister Matteo Renzi have been more hopeful of a deal.
Mr Renzi said: "A technical solution for Greece can be found. What is more important is to find a political solution for Europe."
Mr Tsipras will address the European Parliament on Wednesday, a Greek government source said.
View from Germany: Jenny Hill, BBC News, Berlin
A picture of Angela Merkel wearing an old Prussian military helmet dominates the front cover of Bild. "Today," the headline reads "we need the Iron Chancellor!" referring to Otto von Bismarck, who first held the post.
For weeks the tabloid has been leading the charge against Greece. Like many here, it has had enough. "No more billions for Greece," it urged on Tuesday.
The chancellor is under huge domestic pressure not to cave in to Greek demands for debt relief. Her deputy, Sigmar Gabriel, has said that to do so would destroy the eurozone.
And on Tuesday the CSU (her party's Bavarian ally) went further: general secretary Andreas Scheuer wants Berlin to reject further negotiations, let alone a third bailout package. The Bavarian finance minister, Markus Soeder, has said he simply wants Greece out of the eurozone.
And these are the MPs who will have to vote before negotiations over any proposed new deal can even start. Mrs Merkel says she wants to keep the eurozone together; she's got a battle on her hands at home first.
Where do eurozone countries stand?
Mr Tsipras has been reported to want Greece's vast €323bn ($356bn; £228bn) debt to be cut by up to 30%, with a 20-year grace period.
Germany has warned against any unconditional write-off of Greece's debt, amid fears it would destroy the single currency.
Greece's teetering banks have been shut since the last international bailout programme expired last Tuesday and are to remain closed until at least Wednesday.
Media caption Jean-Claude Juncker told the European Parliament he was texting the Greek PM, after complaints about his phone use
The European Central Bank (ECB) is maintaining its pressure on the banks, refusing to increase emergency lending and ordering them to provide more security for existing emergency loans.
Capital controls have been imposed, with people unable to withdraw more than €60 a day from cash machines.
The European Commission - one of the "troika" of creditors along with the IMF and the ECB - wants Athens to raise taxes and slash welfare spending to meet its debt obligations.
Greece's Syriza-led left-wing government, which was elected in January on an anti-austerity platform, said creditors had tried to use fear to put pressure on Greeks.

What are the scenarios for Greece?

What happens next?
Eurozone decision down to politics
Mr Tsipras met Greek political party leaders on Monday to agree demands to reach a "socially fair and economically viable deal". According to Greek media, the demands include:
  • Securing liquidity for Greece's financial system
  • Credible reforms with reduced recessionary impacts
  • Strong programme for growth
  • Restructuring of Greek debt - that could mean writing some off and rescheduling repayments

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