Eurogroup comes down hard on Greece

Greece was left in no doubt at Friday’s Eurogroup that it is running out of time and its lenders out of patience as they attempt to conclude negotiations so 7.2 billion euros in bailout funding can be disbursed.

Eurogroup chief Jeroen Dijsselbloem said that there were still “wide differences” between Greece and the institutions and that there had to be a significant improvement in discussions between the various parties.

“It was a very critical discussion,” said the Dutch finance minister. “There remain big, big problems to be solved for Greece,” he added.

A European official who had knowledge of the discussions that took place behind closed doors in Riga, Latvia, told Kathimerini that the atmosphere at yesterday’s eurozone finance ministers’ gathering was the worst he had known for the last seven years.

Reports suggest that Greek Finance Minister Yanis Varoufakis was on the receiving end of heavy criticism about the lack of progress and that his own competence was brought into question by some of his counterparts.

“I would describe today’s meeting as complete breakdown of communication with Greece,” Malta’s Finance Minister Edward Scicluna told Bloomberg. “There is an apparent detachment between both sides. There is a huge gap between Varoufakis and what the institutions are saying about what is really going on. It is clear nobody is speaking the same language.”

Varoufakis accepted that talks had not gone well but insisted that a deal would still be reached. “We agreed that an agreement will be difficult but it will happen and it will happen quickly because that is the only option we have,” he said.

He also expressed frustrations that proposals made by Greece to technocrats at the Euro Working Group had not been put before finance ministers for further discussion.

Dijsselbloem said that there will not be an emergency Eurogroup before the end of the month, despite the Greek side hoping that it could secure such a meeting. He also ruled out Greek aspirations for a partial disbursement of the 7.2 billion euros in return for Athens accepting some of the reforms being demanded.

Further ratcheting up the pressure on Greece, European Central Bank President Mario Draghi said the lender’s executive council would examine whether to increase the haircut it applies to collateral offered by Greek banks borrowing from the ECB.

In Athens, government sources were upset that the Eurogroup destroyed the relatively calm atmosphere that followed from the meeting between Prime Minister Alexis Tsipras and German Chancellor Angela Merkel on Thursday. The prime minister’s office suggested that the negative mood in Riga was designed to place more pressure on Athens as it edges toward a deal.

On her part, Merkel called for patience as negotiations continue.

“It’s important that we show understanding for each other,” Merkel told a crowd at a campaign event in Bremerhaven, Germany. “We don’t know if this will work out.”

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