Buying time: EU wants deal on Greece by the end of the week

EPA/OLIVIER HOSLET

French President Francois Hollande, Greek Prime Minister Alexis Tsipras, and Spanish Prime Minister Mariano Rajoy at the EU Council in Brussels, 22 June 2015.

Greece faces a 1.6 billion euro repayment to the IMF on June 30 which it probably cannot make without help from its creditors.


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Complacency and careful political harmony was the result of Monday’s extraordinary summit on Greece. European Commission President Jean-Claude Juncker announced, towards midnight, that there was progress in the discussions with Greece and that the Eurogroup would have “to present final conclusions on Wednesday evening”, so that the EU leaders could have them ready when they meet for the regular summer summit on Thursday.

“I simply wanted to say that the proposals that the Greek government was submitting to our meditation tonight and early this morning – although these proposals were coming in with some delay – are a major step taken by the Greek authorities”, said Juncker.

Previously, Eurogroup chief Jeroen Dijsselbloem had also said that the Greek proposals were comprehensive and “a basis to really restart the talks”.

Alexis Tsipras made serious concessions on pensions reform, one of his favourite “red lines”.

Early retirements would be limited and the allowance for low pensions would be suppressed in 2018 in what would be a highly symbolic measure.

The Greek government also proposed to keep three VAT rates, at 6 %, 13 %, and 23 %. Books and medecines would be taxed at 6 % and electricity at 13 %.

Tourism and restaurants remain the major stumbling blocks.

Summoned to Brussels today, the Eurozone leaders wanted clearly to buy time until Thursday. Eurozone finance ministers broke off talks earlier without a full agreement on Greece’s bailout.

Greece needs more loans from its creditors, which include its fellow eurozone states and the International Monetary Fund, in time for June 30, when it faces a debt repayment it cannot afford. The country has been negotiating for four months what economic reforms it should make to get the money.

Greece faces a 1.6 billion euro repayment to the IMF on June 30 which it probably cannot make without help from its creditors.

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