Greece's creditors piled pressure on cash-strapped Athens on Thursday as the IMF pulled its team out of talks and the EU warned Athens to stop gambling with the possibility of default and a messy exit from the eurozone.
The International Monetary Fund said an agreement remained far-off after a five-month stalemate with Greece's anti-austerity government, which faces being unable to pay huge debts at the end of the month.
Eleventh-hour talks in Brussels between Greek Prime Minister Alexis Tsipras and European Commission chief Jean-Claude Juncker meanwhile broke up without reaching a deal on reforms in exchange for bailout cash.
"There are still major differences between us in most key areas," IMF spokesman Gerry Rice told reporters in Washington. "There has been no progress in narrowing these differences recently. Thus we are well away from an agreement."
The fund said its Greek talks team had returned to Washington from Brussels and that the "ball is very much in Greece's court right now" -- although it added that "the IMF never leaves the table and remains engaged."
It said the key disagreements were on pensions, taxes and financing.
The Greek government, for its part, said it would "intensify" efforts to resolve differences with its creditors, "including in the next 24 hours".
The IMF is the most hardline of Greece's three bailout monitors -- the others being the European Commission and European Central Bank -- who have demanded tough reforms in exchange for unlocking the remaining 7.2 billion euros ($8.1 billion) of its 240-billion-euro rescue package.
Without fresh external funding when the bailout expires on June 30, cash-strapped Greece is set to default on its debts, meaning it could crash out of the eurozone despite benefitting from two international bailouts since 2010.
- Crisis going to the wire -
Athens shares closed with an 8.16-percent leap on Thursday, shortly before the IMF announcement, on investors' optimism for a deal.
The crisis is now set to go to the wire with a Eurogroup meeting of eurozone finance ministers in Luxembourg on June 18 seen as the last chance to seal a deal in time to get it through national parliaments by the end of the month.
EU president Donald Tusk issued an unprecedented warning to Tsipras, telling the Greek government to stop "gambling" and saying the Eurogroup meeting would be "really crucial" and "decisive".
"There is no more time for gambling. The day is coming, I am afraid, that someone says the game is over," he told a press conference.
Thursday's Tsipras-Juncker talks, the second set in as many days and the third in a week, ended almost exactly as the IMF issued its statement, with both sides saying there was still no deal.
"We are working in order to bridge the main differences, especially the differences on fiscal and financial issues," Tsipras said after the talks on the sidelines of an EU-Latin American summit in Brussels.
The EU said Juncker had explained to the Greek leader Tsipras "a possible process with the three institutions that would still allow finding mutually acceptable solutions in time" -- but admitted there was no agreement.
Late-night talks between Tsipras, German Chancellor Angela Merkel and French President Francois Hollande on Wednesday also ended without a deal, producing only a pledge to "intensify" their efforts.
- Protests in Athens -
Tsipras, whose radical-left Syriza party won elections in January with a promise to end five years of austerity, has refused to back down on the reforms demanded by Greece's creditors.
Fresh protests erupted in Athens as Communist trade union protesters occupied the finance ministry in the landmark Syntagma Square, hauled down the EU flag and draped a huge banner over the building.
"We have bled too much, we have paid, stop the new measures," said the banner.
Unions called for further protests later Thursday against a government "that no longer understands the real need of workers," a statement said.
Greece's public broadcaster ERT meanwhile came back on the air on Thursday, exactly two years after it was shut down by the previous government, which had accused it of being wasteful and mismanaged.
But the situation remains dire for Greece, with ratings agency Standard & Poor's on Wednesday further cutting its junk rating for Greek government bonds after it delayed a debt payment to the International Monetary Fund last week.
The head of the German central bank, Jens Weidmann, warned Thursday that the dangers of contagion from a possible Greek insolvency could not be "underestimated".
Greek officials had indicated a possible willingness to compromise on Wednesday on the issue of budgetary targets, adding that they were discussing a possible extension of the bailout until March 2016.
Greece’s creditors piled pressure on cash-strapped Athens on Thursday as the IMF pulled its team out of talks and the EU warned Athens to stop gambling with the possibility of default and a messy exit from the eurozone.
The International Monetary Fund said an agreement remained far-off after a five-month stalemate with Greece’s anti-austerity government, which faces being unable to pay huge debts at the end of the month.
Eleventh-hour talks in Brussels between Greek Prime Minister Alexis Tsipras and European Commission chief Jean-Claude Juncker meanwhile broke up without reaching a deal on reforms in exchange for bailout cash.
“There are still major differences between us in most key areas,” IMF spokesman Gerry Rice told reporters in Washington. “There has been no progress in narrowing these differences recently. Thus we are well away from an agreement.”
The fund said its Greek talks team had returned to Washington from Brussels and that the “ball is very much in Greece’s court right now” — although it added that “the IMF never leaves the table and remains engaged.”
It said the key disagreements were on pensions, taxes and financing.
The Greek government, for its part, said it would “intensify” efforts to resolve differences with its creditors, “including in the next 24 hours”.
The IMF is the most hardline of Greece’s three bailout monitors — the others being the European Commission and European Central Bank — who have demanded tough reforms in exchange for unlocking the remaining 7.2 billion euros ($8.1 billion) of its 240-billion-euro rescue package.
Without fresh external funding when the bailout expires on June 30, cash-strapped Greece is set to default on its debts, meaning it could crash out of the eurozone despite benefitting from two international bailouts since 2010.
– Crisis going to the wire –
Athens shares closed with an 8.16-percent leap on Thursday, shortly before the IMF announcement, on investors’ optimism for a deal.
The crisis is now set to go to the wire with a Eurogroup meeting of eurozone finance ministers in Luxembourg on June 18 seen as the last chance to seal a deal in time to get it through national parliaments by the end of the month.
EU president Donald Tusk issued an unprecedented warning to Tsipras, telling the Greek government to stop “gambling” and saying the Eurogroup meeting would be “really crucial” and “decisive”.
“There is no more time for gambling. The day is coming, I am afraid, that someone says the game is over,” he told a press conference.
Thursday’s Tsipras-Juncker talks, the second set in as many days and the third in a week, ended almost exactly as the IMF issued its statement, with both sides saying there was still no deal.
“We are working in order to bridge the main differences, especially the differences on fiscal and financial issues,” Tsipras said after the talks on the sidelines of an EU-Latin American summit in Brussels.
The EU said Juncker had explained to the Greek leader Tsipras “a possible process with the three institutions that would still allow finding mutually acceptable solutions in time” — but admitted there was no agreement.
Late-night talks between Tsipras, German Chancellor Angela Merkel and French President Francois Hollande on Wednesday also ended without a deal, producing only a pledge to “intensify” their efforts.
– Protests in Athens –
Tsipras, whose radical-left Syriza party won elections in January with a promise to end five years of austerity, has refused to back down on the reforms demanded by Greece’s creditors.
Fresh protests erupted in Athens as Communist trade union protesters occupied the finance ministry in the landmark Syntagma Square, hauled down the EU flag and draped a huge banner over the building.
“We have bled too much, we have paid, stop the new measures,” said the banner.
Unions called for further protests later Thursday against a government “that no longer understands the real need of workers,” a statement said.
Greece’s public broadcaster ERT meanwhile came back on the air on Thursday, exactly two years after it was shut down by the previous government, which had accused it of being wasteful and mismanaged.
But the situation remains dire for Greece, with ratings agency Standard & Poor’s on Wednesday further cutting its junk rating for Greek government bonds after it delayed a debt payment to the International Monetary Fund last week.
The head of the German central bank, Jens Weidmann, warned Thursday that the dangers of contagion from a possible Greek insolvency could not be “underestimated”.
Greek officials had indicated a possible willingness to compromise on Wednesday on the issue of budgetary targets, adding that they were discussing a possible extension of the bailout until March 2016.
