Greek Prime Minister Alexis Tsipras said some creditors haven’t accepted the country’s proposals to unlock aid as he prepared to depart for emergency talks in Brussels.
“The insistence of certain institutions of not accepting parametric measures has never happened before -- not in Ireland, nor in Portugal,” Tsipras wrote Wednesday on his Twitter account. This stance suggests they either don’t want an agreement or serve specific interests in Greece, he said.
Tsipras is meeting Wednesday with the heads of the three creditor institutions -- European Central Bank President Mario Draghi, International Monetary Fund Managing Director Christine Lagarde and European Commission President Jean-Claude Juncker -- in an effort to reach a deal before Greece’s bailout expires and about 1.5 billion euros ($1.7 billion) in payments come due to the IMF on June 30.
Tsipras on Monday proposed a package of measures that includes tax increases on companies and high-income individuals to meet fiscal targets set out by creditors to receive billions of euros in needed financial assistance. While European leaders meeting at an emergency summit on Monday welcomed the Greek proposals as step forward, they stressed that an agreement must be based on the terms put forward by the IMF, the ECB and the European Commission.
“We once again stated that the basis for discussion is the so-called aide-memoire” issued three weeks ago in Berlin, German Chancellor Angela Merkel told reporters.
Greek stocks and bonds, which rallied in the past couple of days on hopes that a deal was imminent, were trading lower on Wednesday. The Athens Stock Exchange index was 3.6 percent lower at 12:58 p.m. in Athens, having gained 15 percent earlier this week. The yield on the 2-year bond was 38 basis points higher at 21.4 percent.
Creditors may present Greece with a revised version of their plan, hammered out three weeks ago, after largely rejecting the measures proposed by Tsipras, said an international official directly involved in the talks, who asked not to be named as he wasn’t authorized to speak publicly.
On Monday, Lagarde told her executive board she was optimistic a deal was at hand and that she expected Greece to pay the money it owes the IMF on June 30, according to a person familiar with the matter. Publicly, Lagarde had struck a more cautious note, saying there was an “enormous” amount of work left to do.
The Greek proposals include steps to eliminate early retirement options, raise the sales tax, increase taxes that middle- and high-income earners pay and introduce a new levy for companies with annual net income of more than 500,000 euros.
Following Tsipras’s talks in the afternoon, euro-area finance ministers will come together Wednesday evening -- their third gathering in a week -- for an emergency meeting to help hammer out a deal to avert a Greek default. [Bloomberg]