ECONOMY

Eurozone lists tough conditions for Greek debt deal

eurozone-lists-tough-conditions-for-greek-debt-deal

Greece must start to implement tough reforms as early as next week in exchange for a bailout to keep it in the euro, according to proposals drawn up by finance ministers for a eurozone summit on Sunday.

The resumed talks early Sunday amid sharp differences over how much to demand of Athens, after nine hours' wrangling on Saturday failed to produce an agreement.

"We have finalized our discussions. We have come a long way but a couple of big issues are still open," said Jeroen Dijsselbloem, head of the 19-nation eurozone finance ministers' group.

"We are going to give those to the leaders, so it is up to them," Dijsselbloem said, without giving further details.

Finland's Alexander Stubb, a consistent hardliner demanding Greece honor its reform commitments, said Athens would have to pass into law a first series of promised economic reforms by Wednesday.

"I think we have a very good proposal on the table; it has far-reaching conditionality," Stubb said.

He said the list also included "tough conditions on labor reform and pensions, VAT and taxes (plus) quite tough measures on privatizations."

Greek Prime Minister Alexis Tsipras won office in January promising to end years of austerity measures accepted in return for two massive international debt bailouts worth 240 billion euros.

Tsipras had repeatedly said austerity had only helped wreck the Greek economy.

But when creditors pulled the plug on the last bailout package last month, he was forced to back-track.

"I'm here for an honest compromise. We owe that to the people of Europe. We can reach an agreement tonight if all parties want it," Tsipras said as he arrived for the eurozone leaders' summit Sunday.

A European diplomat said the finance ministers' list also included a German option for ring-fencing some 50 billion of Greek state assets in a fund which would be held against the privatization proceeds Athens says it will now raise.
This option, however, was in parentheses in the document submitted to leaders, meaning that it remained open for discussion.

"It is up to the leaders to fill in the blanks," the European diplomat said.

An earlier German proposal for Greece to leave the eurozone for five years to give it time to stabilize its economy was not in the final list, another European diplomat said.

If the 19 eurozone leaders reach agreement on the list of conditions, it would open the way for Greece to negotiate its third debt rescue, estimated at around 80 billion euros over three years, according to European sources.

[AFP]