Juncker warns Greece that time is running out on bailout
Jean-Claude Juncker, European Commission president, strongly rebuked Alexis Tsipras for his strident dismissal of a new bailout offer from Greece’s creditors and suggested the prime minister had misled his MPs about the nature of the closed-door negotiations.
In his first remarks since Mr Tsipras used an address to the Greek parliament on Friday to reject economic reform measures presented by Mr Juncker on behalf of Greece’s creditors as “absurd”, the commission president confirmed he had turned away a request by the Greek leader to renew negotiations over the weekend and warned Athens that time was running out.
“I don’t have a personal problem with Alexis Tsipras; quite to the contrary,” Mr Juncker said at the start of a two-day summit of the Group of Seven industrial powers in Krün, Germany. “He was my friend, he is my friend. But frankly, in order to maintain it, he has to observe some minimal rules.”
If the two sides are unable to reach agreement by the end of the week, eurozone leaders would likely move to extend the bailout programme again beyond its current June 30 expiry date, according to a French official.
Such a scenario would entail grave risks, however.
Greece is believed to not have enough money to pay a €1.5bn International Monetary Fund bill at the end of the month, and an extension without an agreement on a new set of economic reforms would not include the €7.2bn in bailout funding Greece urgently needs. In addition, it would need to be approved by the increasingly restive Bundestag.
Mr Juncker also said he had been promised a new counterproposal from Mr Tsipras since the pair met in Brussels on Wednesday and did not want to renew talks until he had received the plan.
Eurozone officials have suggested talks involving Mr Juncker and Mr Tsipras, which could also include Angela Merkel, German chancellor, and François Hollande, French president, may resume on Wednesday, when all four are due in Brussels for a summit with Latin American leaders.
But Mr Juncker said he was cautious about such a timetable if Athens did not present a new way forward.
“I would be surprised if I didn’t have any further discussions with Mr Tsipras, but I would like to have the Greek proposal,” Mr Juncker said. “I would like to have time to study it in detail.”
Mr Juncker’s refusal to renew talks with Athens returns the bailout negotiations to a position of stalemate that he and the leaders of Greece’s two other bailout monitors — the International Monetary Fund and the European Central Bank — thought they had broken through just a week ago.
Although the Greece crisis was not formally on the G7 agenda, a White House spokesman said the standoff was discussed during a Sunday session on the global economy.
Mr Juncker and the commission have long been seen as Greece’s strongest advocate around the creditors’ table, and the president made clear he was rankled by the way Mr Tsipras had belittled his efforts during Friday’s parliamentary speech.
“He was presenting the offer of the three institutions as a ‘leave it or take it’ proposal — that was not the case,” Mr Juncker said. “He was presenting the proposal of the three institutions as being mine and mine exclusively and he knows perfectly well this is not the case.”
On the thorny issue of pension cuts, Mr Juncker said the Greek prime minister failed to tell his parliament that creditors’ remained open to Greek suggestions that concerns about poorer pensioners could be addressed.
According to the French official, creditors are open to the Greek proposal to maintain pensions for poorer recipients but they would have to find €800m in 2015 and 2016 in other cuts to compensate for the new deficits the spending would incur.
Over the weekend the outpouring of frustration from EU leaders over Mr Tsipras’s position appeared to come from all quarters.
Johan Van Overtveldt, Belgium’s finance minister, wrote on Twitter that it was “hard to see what [the] Greek prime minister wants to negotiate about with its partners after flatly rejecting their latest proposals.”
Peter Kazimir, the Slovak finance minister, also took to Twitter, writing that after listening to Mr Tsipras’s speech, “I wonder whether this is the same Tsipras who was in Brussels.”
Donald Tusk, European Council president who is also representing the EU at the G7, weighed in, taking a thinly veiled swipe at Mr Tsipras at the press conference with Mr Juncker for oversimplifying the discussions.
“It’s not true that debtors are always moral and creditors are always immoral,” Mr Tusk said. “It’s much more complex and much more sophisticated than some politicians want to say and want to show.”