France and Germany split over bid to break Greece deadlock
German Finance Minister Wolfgang Schaeuble (C) chats with unidentified officials during a euro zone finance ministers' meeting on the situation in Greece, in Brussels, Belgium, July 12, 2015. REUTERS/Eric VidalStark differences remain between eurozone finance ministers as they met on Sunday to discuss Greece’s bailout plan©ReutersSpain's Economy Minister Luis de Guindos (L) chats with Italy's Finance Minister Pier Carlo Padoan during an euro zone finance ministers' meeting on the situation in Greece, in Brussels, Belgium, July 12, 2015. Euro zone leaders will fight to the finish to keep near-bankrupt Greece in the euro zone on Sunday after the European Union's chairman cancelled a planned summit of all 28 EU leaders that would have been needed in case of a "Grexit". REUTERS/Eric VidalDiscussions in Brussels are expected to last until late into Sunday night©ReutersThere is a growing divide between France and Germany over Greece’s proposed bailout plan©AFPGerman chancellor Angela Merkel has warned there will not be an ‘agreement at any cost’©EPAGreek prime minister Alexis Tsipras said he was ‘ready for a compromise’, adding that an agreement could be reached ‘if all parties want it’©EPATalks have been complicated after Finland’s True Finns threatened to pull out of the coalition government if a Greek bailout goes ahead©EPAIn Greece, people remain anxious about the outcome of the negotiations©GettyGreek politicians have taken to local media to denounce EU hardliners©Getty
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Germany on Sunday night heightened the pressure on Greece to implement bolder economic reforms in order to secure its place in the eurozone, despite attempts by France to broker a compromise.
Fraught negotiations in Brussels over a €53.3bn bailout package at the weekend created fresh uncertainty for Greece’s future in Europe’s monetary union after finance ministers failed to agree a way out of the biggest crisis to face Europe since 2012.
However, a fragile compromise was emerging late on Sunday under which Athens would pass tough new reform laws, including on pensions, by Wednesday and prepare further rapid reforms this month.
But it was unclear whether this deal could be implemented in time to satisfy German chancellor Angela Merkel and other critics — or forestall Greece’s financial collapse.
French president François Hollande pledged to get an agreement and warned that at stake was not just whether Greece stayed in Europe but “our conception of Europe”.
But a grim Ms Merkel said: “There’s not going to be an agreement at any cost.” Eurozone leaders, she added, were considering “nothing more and nothing less” than the preconditions for a Greece rescue by Europe’s bailout fund — a stance that appeared to cast doubt on whether a full accord could soon be reached.
The Franco-German impasse threatened to strain Ms Merkel and Mr Hollande’s recent efforts to bolster the EU’s key political alliance. However, the two leaders’ comments also left room for manoeuvre, perhaps allowing a conditional deal that would pave the way to bailout negotiations if Greece delivers on the promised reform legislation.
Highlighting the drama, Luxembourg has warned Germany that pressing for Grexit would bring “a profound conflict” with France and “catastrophe for Europe”. Jean Asselborn, foreign minister, told the Süddeutsche newspaper that it would be “fatal for Germany’s reputation in the EU and the world” if Berlin did not seize the chance offered by the Greek reform promises.