Greek Prime Minister Alexis Tsipras called for a speeding up of work to conclude a reform-for-cash deal with eurozone creditors to keep his country afloat after talks with German Chancellor Angela Merkel yesterday.
The leftist Greek premier met the conservative German leader before an emergency EU summit on migration, a day before eurozone finance ministers meet in Riga to review progress – or the lack of it – in slow-moving negotiations between Athens and its international lenders.
A Greek official said they noted that “significant progress” had been made since they last met in Berlin a month ago.
“The Prime Minister asked that the procedures be speeded up so that the decision, which foresees a first interim agreement by the end of April, be implemented,” he said.
There was no immediate comment from the German side but Berlin has taken a tough line in insisting that Athens must carry out commitments made by a previous conservative-led government to reform labour markets, pensions and sales tax to unlock urgently needed international bailout funds.
EU officials said Merkel would deliver a message that she wants to keep Greece in the single currency area and avoid a catastrophic default but to achieve that, Tsipras’s government must commit in technical talks to detailed, costed measures to make public finances sustainable.
“At the highest level, the Germans want to keep Greece in the euro area and find a solution but time is running short and there may have to be more drama before Tsipras can put his foot down and reach an agreement,” one senior official said.
While Greece has pushed for a quick political agreement, the Chancellor has so far insisted it is up to Athens to satisfy representatives of the European Commission, the International Monetary Fund and the European Central Bank first.
Greece has yet to agree with its partners on a comprehensive list of reforms to secure €7.2 billion remaining from its €240 billion EU/IMF bailout. Without a deal, investors fear it could run out of money and default on its official creditors, possibly forcing it to leave the 19-nation single currency area.
Eurozone and Greek officials said yesterday that Athens could probably scrape together public cash reserves to meet its payment obligations into June but it faces a hump of bond redemptions to the ECB in July and August that it cannot meet without a fresh injection of funds.
“We can’t wait for a deal in June due to our liquidity problems. We must find a solution before that,” a government official in Athens told Reuters on condition of anonymity.
The ECB’s chief economist, Peter Praet, said the central bank was prepared to keep authorising emergency lending to Greek banks for now because they were assessed to be solvent.
“It is true that it is a stressful situation,” Praet said at an event in Berlin. “I’m not going to discuss how long this will go on. Verbal discipline is of the essence in crisis times.”