Greece proposes EU funding agreement over two years

temps-reduit-pour-reponse-greceGreece on Tuesday proposed to creditors to conclude with the European Stability Mechanism (ESM) a two-year agreement to cover its financial needs while restructuring its debt, said the office of the Prime Minister Alexis Tsipras.

In a statement entitled “MES request,” the government says “stay at the negotiating table” despite the organization of a referendum Sunday on discussions with creditors and have “now proposed” agreement at MES two years “to complete coverage of its financial requirements and debt restructuring.”
The Greek Finance Minister Yanis Varoufakis confirmed earlier that Greece would not pay Tuesday maturity of 1.6 billion euros ($ 2.2 billion) owed to the IMF.
The minister, waited by the media at the entrance of his ministry, was asked if the payment would take place. “No,” he replied tersely has before going to his office.
German Chancellor Angela Merkel said Tuesday any knowledge of a new EU proposal that would have made to Greece to unlock a last-minute agreement on the bailout of the country.
“The latest offering from the Commission which I know is that last Friday and I can not say anything more,” said Merkel, while Brussels has indicated that it proposed a solution of “last minute” to Greek Prime Minister Alexis Tsipras . The German ruling, however, reiterated that “the door remains open” for further discussions with Athens.
The President of the European Commission, Jean-Claude Juncker, proposed Monday to Greek Prime Minister Alexis Tsipras, a solution “last minute” that could unlock a deal on the bailout of the country, said Tuesday the Commission.
In a telephone conversation, Mr Juncker said “the contours of a last-minute solution,” according to a source at the Commission. The idea is that Mr. Tspiras accept the latest plan of creditors dated Saturday and undertakes to call the Greeks to endorse the text at the planned referendum Sunday, which would by then holding a Eurogroup has -t source said.
Mr Juncker said “what a solution could look like last minute,” confirmed the spokesperson of the Commission, Margaritis Schinas, noting that the exchange between the head of the EU executive and Mr. Tsipras took place at the initiative of the latter.
The “parameters” of such a solution, according to Mr Juncker, “would include a response to the financial needs of the country and the question of debt sustainability” in exchange for the commitment of the Greek government to campaign for a yes the referendum, said Mr. Schinas.
“Contacts are ongoing” between Athens and Brussels after this exchange, while Mr Juncker also viewed Monday evening the President of the Eurogroup Jeroen Dijsselbloem, said the spokesman.
“The time is reduced” for an answer from Greece, while the country’s bailout program expires “on June 30 at midnight,” the risk of rushing the country into default, noted Mr Schinas.
He emphasized that ultimately, any solution to the crisis should be given by the Eurogroup.
Lawmaker Syriza, Stelios Kouloglou, held that “the initiative Juncker must be seized,” in an interview with Greek radio. He claimed that “the presidents of all parliamentary groups in Brussels” had prompted Mr Juncker Monday “to resume negotiations to reach an agreement even at the last moment.”
According to a European source, Juncker has proposed to the Greek radical left leader to reply by sending a letter to him and to Mr. Dijsselbloem, and German leaders, Angela Merkel and French, Francois Hollande, “accepting Saturday from proposals of the three institutions’ creditors, ECB, IMF and EU.
In this case, a meeting of the 19 finance ministers of the euro area – or Eurogroup – could be convened “to adopt a declaration on the basis of the lines already explained to Mr. Tsipras’ do we added the same source.
Economists leftist rally
PARIS – Several economists left were mobilized Tuesday to defend Greece, asking the country to be bailed out in an emergency, prior to reopen talks to avoid a euro exit.
In an open letter published in the Financial Times, 19 economists and researchers including US Nobel laureate Joseph Stiglitz, the French Thomas Piketty, former Italian Prime Minister Massimo D’Alema, former Governor of the Central Bank of Cyprus Panicos Demetriades, or the American economist James Galbraith, near the Greek Finance Minister Yanis Varoufakis, asking the Europeans to make Greece a “beautiful story.”
These scientists believe that we must first help Greece escape an impending failure by helping to repay the $ 1.6 billion due Tuesday night at the International Monetary Fund, but also relieve the country heavy schedule with the European Central Bank, falling in July and August, through exchange of securities.
Everything is in their view allow “fresh start” in negotiations between Greece and its partners, which ended so sensational last weekend, after the announcement of a referendum in Greece and a financial ultimatum creditors .
Any further discussion should be done in “keeping in mind first that the recessive austerity requested to Greece was criticized by IMF economists themselves, and then that the leadership of Syriza promised to reform the deeply Greek State – if they are allowed the opportunity. ”
The key demands of the Greek government to Alexis Tsipras, namely to end five years of austerity policies, and reducing the heavy public debt of the country, are supported from the beginning by many prestigious economists center-left.
One of the most vocal is another Nobel laureate US economy, Paul Krugman. On Tuesday, he again criticized on his blog the management of the crisis: “If Europe as it is now organized manages to transform the budgetary failures medium term (as in Greece) in this sort of nightmare then this system is deeply unsustainable. ”
“We are very close to a great catastrophe: open this Pandora’s box of a country emerging from the euro zone is a mistake that would be dramatic, historical,” Mr. Piketty felt for his part, in an interview on Europe 1.
Featured The French economist, known for his work on inequality, found also that “the French, German, the Brussels authorities have refused to address the important issue is the overall restructuring of Greek debt and besides other highly indebted European countries such as Portugal to Italy. ”
Chronology of a critical week
Saturday, June 27
Around 1 pm local (Friday 18 pm Eastern time), Alexis Tsipras ad on TV a referendum on July 5, to accept or to reject the latest proposal of the creditors on new austerity measures, which has already already rejected by Athens.
“The people must decide beyond a blackmail (…). The proposals of creditors’ aim humiliation of an entire people, “says the Prime Minister.
The surprise referendum announcement has the primary effect of the Greeks rushing to ATMs.
The President of the Eurogroup Jeroen Dijsselbloem, who believes that Greece has broken off negotiations, said that the bailout plan will end on June 30, without overtime. But on June 30 also, Greece must 1.5 billion euros to the IMF clearly has no money to do it, and non-payment is considered to be a serious and exceptional event.
Sunday, June 28
In the evening, Alexis Tsipras announced the closure of banks for a week, and the introduction of capital controls. The ATM withdrawals are limited to 60 euros a day.
Alexis Tsipras reformulates unsuccessfully to the EU and the ECB’s request for an extension of Greece beyond 30 June of the aid it receives program. The previous Conservative government had already obtained a first extension of two months until the end of February, this program further extended for four months at the request of Tsipras government.
The European Central Bank (ECB) grants a stay in Athens maintaining unchanged the ceiling of his provision of emergency liquidity to Greek banks. The IMF stands ready to provide “assistance,” said its director general Christine Lagarde.
Every weekend, large queues were stretched to the distributors, the Greeks seeking to remove as much liquid as possible.
Monday, June 29
Greek banks remain closed, first day of capital controls decreed by Greece, a decision which destabilizes global stock markets without making them panic.
The President of the European Commission, Jean-Claude Juncker, began the battle for the “yes.” “A ‘no’ would mean (…) as Greece says ‘No’ to Europe,” said Juncker, criticizing the radical leftist Tsipras government and saying “betrayed” by the Greece.
French President Francois Hollande and German Chancellor Angela Merkel also bind them holding the referendum in Greece in the euro, proposing to await the outcome before any further negotiations.
But in parallel, Francois Hollande and Obama agree “to promote a resumption of talks.” The door “remains open,” said for his part the head of the Eurogroup Jeroen Dijsselbloem, saying it was still “conceivable” to avoid a “Grexit” a Greek exit from the eurozone.
Russia “understands” the Tsipras policy and hopes that Brussels will avoid a “scenario the adverse consequences.”
Tuesday, June 30
Jean-Claude Juncker proposes a solution to Alexis Tsipras ‘last minute’ may unlock an agreement on the bailout of the country, according to a Commission source.
The Greek Finance Minister Yanis Varoufakis confirms that Greece will not be able to pay before the end of the day the maturity of € 1.5 billion owed to the IMF.
Bombshell: Greece offers its creditors to conclude with the European Stability Mechanism (ESM) a two-year agreement to cover its financial needs.
A teleconference of the Eurogroup is announced for the evening after the proposal.
Sunday, July 5
Tuesday afternoon, the referendum on offer creditors to Greece was still scheduled for Sunday.

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