Greece battles to avert looming default debacle

ATHENS: Greece tried today to drag loan talks with its EU-IMF creditors back from the brink after negotiations collapsed over the weekend and left the country just two weeks away from a catastrophic default on its debt.

Hours after radical-left Prime Minister Alexis Tsipras defiantly called on the creditors to be ‘more realistic’, Athens said it was ready to return to the talks ‘at any time’.

“We await the invitation of the (creditors) and will respond at any time to continue the negotiation,” Tsipras’ office said.

Tsipras’s government has been locked in negotiations with Greece’s creditors — the European Union (EU) and the International Monetary Fund (IMF) for five months, in the hopes of securing the release of the remaining 7.2 billion euros in rescue funds.

But frustration has mounted on both sides, with Athens refusing to sign on to what it described as ‘irrational’ economic reforms demanded by its creditors.

Tsipras today lambasted the creditors for ‘political opportunism’ in trying to force Athens to further streamline its pension system, a concession the leftist anti-austerity government has steadfastly refused to make.

“One can only see a political purposefulness in the insistence of creditors on new cuts in pensions after five years of looting under the bailouts,” Tsipras told Greek newspaper Efimerida Ton Syntakton.

But an EU spokeswoman said the EU and IMF have already made ‘major concessions’ to Greece. “It’s not a one-way street,” Annika Breidthardt told a press conference.

She added: “The concessions ... made and the flexibility that has been shown are already quite substantial.”

In Frankfurt, European Central Bank (ECB) Chief Mario Draghi urged all sides ‘to go the extra mile’ but insisted the ball was in Athens’ court.

“A strong and credible agreement with Greece is needed, not only in the interest of Greece, but also of the euro area as a whole,” Draghi told the European Parliament’s Committee on Economic and Monetary Affairs in Brussels.

French President Francois Hollande likewise urged Greece to ‘not waste time’.

The Athens Stock Exchange plunged 7.14 per cent in early trade today before closing with a 4.68 per cent drop, with bank stocks especially hard hit.

Draghi, however, gave the assurance that the banks were currently solvent and that the ECB will continue to provide liquidity to them to help finance the economy.

Greece’s 240 billion euro bailout expires on June 30, and to meet that deadline, a reform deal must beresolved by a meeting in Luxembourg on Thursday of the eurozone’s 19 finance ministers, who controlthe purse strings of the rescue programme.

Also at the end of the month, Greece faces a 1.6 billion-euro payment to the IMF with another 6.7 billion euros due to the ECB in July and August, which Greek officials have said the government cannot afford.