NEWS

Greece offers new proposals ahead of Monday’s emergency summit

Prime Minister Alexis Tsipras made a new offer on a reforms package to foreign creditors on Sunday, signaling eleventh-hour concessions to break a deadlock that has pushed Greece to the brink of bankruptcy.

After months of wrangling and with anxious depositors pulling billions of euros out of Greek banks, Tsipras’s leftist government showed a new willingness this weekend to make concessions that would unlock frozen aid to avert default.

French President Francois Hollande, on a visit to Milan, confirmed Greece had submitted new proposals. EU diplomats said the proposal had not arrived but representatives from the country’s European and IMF creditors were set to meet on Sunday evening to discuss it.

It was not immediately clear how far the new proposal yielded to creditors’ demands for additional spending cuts and tax hikes, but the offer was a ray of hope that a last-minute deal may yet be wrangled before Athens runs out of cash.

A day before emergency meetings including a summit of eurozone leaders in Brussels, Tsipras was holed up in a marathon cabinet meeting and discussed the new offer with the leaders of Germany, France and the European Commission by phone.

“The prime minister presented the three leaders Greece’s proposal for a mutually beneficial agreement that will give a definitive solution and not a postponement of addressing the problem,» a statement from Tsipras’s office said.

Tsipras, elected on a pledge to end austerity, has defiantly resisted demands to cut pension spending. But Greek officials have suggested Athens may be willing to consider raising value-added-taxes or other levies to appease the lenders.

“There is no time to lose. Every day counts. Talks and negotiations must continue so that an agreement is reached,» Hollande told a joint news conference with Italian Prime Minister Matteo Renzi.

The Greek government has argued the austerity imposed on the southern European country had made the crisis worse. A senior SYRIZA lawmaker said on Sunday that previous ideas put forward by Juncker would have led to a «social holocaust».

But the mood has also hardened in Germany, which has contributed more money than any other country to bailing out Greece. German Chancellor Angela Merkel is under pressure from within her ranks not to give in to Greek demands, even if that means contemplating Greece leaving the euro zone.

Merkel’s Bavarian allies warned against giving in to Greece, with senior Christian Social Union lawmaker Hans Michelbach saying he saw no realistic chance of an agreement on Monday.

“If the EU lets the government in Athens get away with its intransigence, we can bury the euro,» Michelbach said in a statement on Sunday.

“Either Greece declares itself willing for a viable solution or the country must leave the euro. The euro zone could cope with the consequences of a Greek exit,» he said.

[Reuters]