Δευτέρα, 16 Φεβρουαρίου 2015

Greek debt talks collapse after draft deal is dismissed as "absurd"

• Greek government dismisses plans to continue accepting austerity in return for its bailout as "absurd"
• Yanis Varoufakis: "We are asking for a few months of financial stability"
• Prospect of further meeting to agree deal later this week emerges
• Grexit is 'inevitable', former Chancellor Ken Clarke warns
18.26 Pierre Moscovici of the Commission has now taken the stage. He's urging cooperation from the Greeks.
— Open Europe (@OpenEurope) February 16, 2015
18.24 Mr Dijsselbloem adds this week is the final week left to decide whether Greece remains in its bailout programme. Another meeting could be convened for Friday, he adds.
18.23 Mr Dijsselbloem:
"There should be an unequivocal agreement by Greece to honour its obligations".
There should also be the committment by the Greeks to successfully conclude the programme. We should have the assurance that this is their intention."
"On this basis we stand ready to continue our negotiations. The next step must come from the Greek authorities; they have to make up their mind if they want an extension of the current programme."
18.21 Mr Dijsselbloem:
The best way forward is for the Greeks to seek an extension of the programme.
The main reason is that in ongoing discussions, we simply need more time. and the best way to do that is to extend the current programme and this would allow us to work on future arrangements.
Such an extension would allow for the Greeks to use the "normal flexibility" of the programme.
18.20 The outcome of the last agremeent, was that we did "not finalise an agreement".
In general "there is a slight sense of disappointment" at the outcome of the talks between Greece and Troika. There is still "no firm common ground" on how much of the existing bailout will be conformed to by Greece says Mr Dijsselbloem
18.17 The press statement from the head of the Eurogroup Jeroen Dijsselbloem has begun. Mr Dijsselbloem begins by praising Portugal's economy...
18.13 Game Theory anyone?
18.10 Here's what's happened to the euro against the dollar after that news.
18.00 After this sudden collapse in communication, the eurogroup's chief Jeroem Dijsselbloem will be delivering a press conference imminently.
17.53 In a dramatic turn of events, talks have collapsed today. That statement has put the kybosh on any further talks between Greece and its creditors for today at least.
17.48 It's pretty clear which parts of the draft Eurogroup statement are "absurd" to the Greeks.
The crossed out elements below come directly from the pen of Yanis Varoufakis, reports Sky's Ed Conway. It seems the Greek finance minister took umbrage to the notion that Greece will complete its current bailout programme.
"We discussed the policy priorities of the new government on the basis of work undertaken by the institutions and the Greek authorities.
The Greek authorities have indicated that they intend to successfully conclude the programme, taking into account the new government's plans.
We intend to make the best use of the existing built-in flexibility in the current programme. The Greek authorities gave their firm commitment to refrain from unilateral action and will work in close agreement with its European and international partners, expecially in the field of tax policy, privatisation, labour market reforms, financial sector and pensions."
17.40 Reports that the Eurogroup meeting has now been "put on hold." That rejected statement seems to have thrown some sand in the wheels.
17.37 Bruno Waterfield's got hold of the text of that draft statement.
17.35 The sticking point in that draft statement seems to be the implementation of the 'Memorandum of Understanding' and its attached austerity measures for the new Greek government.
A statement from the Greeks reads:
“Some people's insistence on the Greek government implementing the bailout is unreasonable and cannot be accepted.
“Those who keep returning to this issue are wasting their time. Under such circumstances, there cannot be a deal today.”
17.20 If Greece and its creditors don't come up with some acceptable agreement to extend the country's existing agreement, or more ambitiously, come up with a new one, then it could put the European Central Bank in a bit of a bind.
The ECB will meet on Wednesday to decide whether or not to continue providing emergency liquidity to Greek banks. The ECB has allowed emergency funding for Greek banks worth €65bn. If Greece is not longer part of any bailout agreement, this assistance could be withdrawn all-together, effectively dumping the country out of the euro.
17.15 Some unpromising news emerging from today's meeting. A draft statement proposed by the Eurogroup has been dismissed as "absurd" and "unacceptable" according to Greek government sources quoted by Reuters.
16.50 Coffee time, folks
16.30 If you had hopes of a quick resolution to events today, throw them out of the window.
Finance ministers are are done with the preamble and are now beginning to get to the meaty stuff. More than two hours after we kicked off.
16.00 The parallels between today's monetary union and the Gold Standard of the inter-war period are often noted.
Much like the malfunctioning fixed exchange rate system that forced deflationary policies on Europe's economies after the war, today's eurozone has also forced the highest cost of adjustment on the weakest nations.
Abandoning gold led to the likes of the UK and the Nordic countries to emerge fastest from the depths of the Great Depression.
Doing the same may be more difficult for today's struggling eurozone economies.
15.30 So with finance ministers settling round the table, what's on the agenda?
Last week's meeting between Greece and its creditors ended as somthing of a damp squib. But some semblance of a potential Greek deal did emerge.
• Prime Minister Alexis Tsipras has said he is willing to accept about two-thirds of the austerity plans laid out by its creditors, and renegotiate on the remaining third.
• Greece would also like all talk of the Troika to be banned, referring to the ECB, IMF, and EU instead as "institutions"
• More crucially, the new government is demanding a "bridging agreement" to help keep the country afloat while it continues talks.
This would likely involve the raising of cash through the issuance of short-term T-bills. So far, Greece has reached its limit on T-bill issuance and would need the ECB to budge on this, in return for some form of conditionality.
• Otherwise, a relaxation of Greece's primary surplus targets from their current 4.5pc of GDP, to around 1.5pc has also been touted. This would allow the government to carry out some of its fiscal expansion plans such as raising the minimum wage and re-hiring private sector workers
• A debt-write off is all but an impossibility right now, but this does not preclude a significant debt forgiveness for Greece in the form of a bond swap with growth linked bonds, or the issuance of perpetual bonds which would extend out Greece's maturity
15.10 Could it be a case of David v Goliath today? Well, sort of
15.05 Panic over everyone. Yanis is in the building.
15.00 Hmmm...the eurogroup meeting seems to have kicked off without the main attraction - Yanis Varoufakis.
Not exactly sure where is he right now, but rumours he could be meeting separately with the Commssion's economics tsar and the eurozone's Jerome Dijsselbloem
14.35 Writing in the New York Times today,Greece's finance minister said his country would not cross the "red lines" it has presented to its creditors.
Well, Mr de Guindos of Spain, says his country also has a red line: the repayment of all of Greece's loans in full. Zing.
14.25 Contender for the soundtrack for today's meeting, courtesy of the Rolling Stones and Immanuel Kant
14.14 Could it be a case of the northen creditor bloc v the rest today? Germany, Austria, and now the Fins have all come out singing from the same hymn sheet today.
Finland, who are due to hold a general election next month, have been ardent opponents of any Greek debt relief. And not much seems to have changed today.

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