Fra Guardian:
Greek negotiators head into talks with eurozone finance ministers on Thursday to tackle the debt-stricken country’s deepening crisis after demonstrations against further EU-enforced austerity took place in Athens last night.
Despite warnings that Greece was heading for a possible exit from the euro without an extension of its current bailout deal, the meeting on Thursday is expected to be short, with little likely to be decided.
The gathering of finance ministers from the currency bloc’s 19 member states is due to discuss the gulf between Athens and its creditors, but is expected to delay any decisions to a summit of EU leaders next week, officials in Brussels said.
Financial markets are expected to greet the impasse between Greece and the troika of lenders – the European commission, the International Monetary Fund (IMF) and European Central Bank (ECB) – with dismay, further depressing prices that have slumped in recent days.
A war of words between the Greek prime minister, Alexis Tsipras, and the troika has become further inflamed after he accused the IMF of “criminal responsibility” for the situation and said lenders were seeking to “humiliate” his country.
Jean-Claude Juncker, the president of the European commission, responded by saying he had “sympathy for the Greek people but not the Greek government”. Juncker was until recently rated as one of Tsipras’s only allies.
Informal talks could take place over the weekend, ahead of the EU summit, after the ECB threw Athens a lifeline by raising the maximum emergency funding that Greek banks can obtain by €1.1bn (£790m).
The increase, which brought the overall ceiling on emergency liquidity assistance to €84.1bn, came after a stark warning from the Bank of Greece that the country could crash out of the eurozone unless it can conclude loan talks with its creditors by the end of the month
Yannis Stournaras, the bank’s governor, used his annual report to the Greek parliament to warn that failure to reach a deal would “mark the beginning of a painful course that would lead initially to a Greek default and ultimately to the country’s exit from the euro area and – most likely – from the European Union”.
Stournaras, a finance minister in the previous rightwing and pro-bailout New Democracy administration, was roundly criticised by the government for undermining the negotiating position of elected officials.
Zoe Konstantopoulou, the president of the parliament, said the governor had not only breached his constitutional role but actively attempted to limit the room the government had for manoeuvre in its negotiations with creditors.
She said in a statement: “With his report today, the governor of the Bank of Greece not only exceeded the boundaries of his institutional role, he is attempting to contribute to the creation of an asphyxiating framework in the moves and negotiating abilities of the Greek government.”
The governor’s remarks came before Greece’s Syriza-led government confirmed it will run out of money by the end of the month unless its creditors agree to release €7.2bn in bailout funds.
Euclid Tsakalotos, the lead negotiator, has conceded that the country does not have the funds to make a €1.6bn payment due to the IMF on 30 June.
Athens delayed a payment to the IMF earlier this month, saying it would take advantage of a technical loophole allowing it to bundle three tranches due this month into the single €1.6bn sum.
