Athens: Greek Prime Minister Alexis Tsipras on Sunday dismissed his country’s European Union and International Monetary Fund bailout and said he would not ask EU leaders for an extension.
But he said it was possible to negotiate a transitional agreement with lenders by the end of the month to tide Greece over until a new debt pact had been reached.
“The bailout failed,” he said in his first major speech to parliament as premier. “The new government is not justified in asking for an extension ... because it cannot ask for an extension of mistakes,”
Greece’s current bailout expires on February 28 and the EU wants Athens to apply for an extension, including the commitment to reforms. Greece has ruled that out, setting the stage for clashes in the coming week at an EU summit and finance ministers’ meeting.
Finance Minister Yanis Varoufakis will take Greece’s proposals to an extraordinary meeting of Eurozone finance ministers in Brussels on Wednesday.
The following day Tsipras will hold his first face-to-face talks with German Chancellor Angela Merkel at an EU summit.
So far Greece’s demands for more time to renegotiate the country’s massive 240-billion euros (Dh997.68 million) EU-IMF rescue deal have hit a wall, with European paymaster Germany vehemently opposed.
The European portion of the bailout is due to expire at the end of the month, putting Athens under pressure to do a quick deal or ask for an extension.
Hanging in the balance for Greece is the final 1.8-billion euros loan instalment from the Eurozone, but the new Syriza government refuses the austerity measures at the heart of current bailout, saying it would prefer to refuse the cash and start from scratch with a new deal.
On Friday, the two-week-old government appealed for temporary funding from its EU partners to tide it over while continuing the negotiations.
With no agreement appearing close at hand, credit ratings agencies warned ON Friday that Greece was heading closer to defaulting on its loans, a move that could see it exit the Eurozone.
Standard and Poor’s downgraded Greece to just one notch above the range indicating vulnerability to a default, and warned of a “worst-case scenario” in which it would leave the single currency.
Moody’s said it was placing Greece on review for a downgrade because of “considerable uncertainty regarding the outcome of the ensuing negotiations”.
The former head of the US Federal Reserve, Alan Greenspan, told the BBC on Sunday that he expected Greece would have to leave the Eurozone.
“I believe [Greece] will eventually leave. I don’t think it helps them or the rest of the Eurozone — it is just a matter of time before everyone recognises that parting is the best strategy,” he said.
