World Economy

Greek Bailout Talks Continue

Greek Bailout Talks ContinueGreek Bailout Talks Continue

The German and Greek finance ministers are holding talks with IMF and Eurogroup chiefs ahead of a meeting of eurozone finance ministers on Friday.

The talks are aimed at striking a deal on the request made on Thursday by Greece for a new six-month bailout, BBC said. But Germany and its allies are ready to let Greece leave the euro unless Prime Minister Alexis Tsipras accepts the conditions required to extend his country’s financial support, according to Malta’s finance minister, Edward Scicluna. Greece’s creditors are cranking up the pressure on Tsipras as he seeks a deal to prevent his country defaulting on its obligations as early as next month. By bowing to German demands, the premier risks a domestic backlash from voters and party members whom he’s promised an end to austerity.

“Germany, the Netherlands and others will be hard and they will insist that Greece repays back the solidarity shown by the member states by respecting the conditions,” Scicluna said in an interview. “They’ve now reached a point where they will tell Greece ‘if you really want to leave, leave'.”

Germany's Wolfgang Schaeuble and Greece's Yanis Varoufakis are meeting in Brussels with IMF managing director Christine Lagarde. Also involved in the unscheduled negotiations is Jeroen Dijsselbloem, the Dutch finance minister who heads the Eurogroup. A meeting of eurozone finance ministers was due to start at 1400 GMT but has been delayed.


 French President Francois Hollande reiterated that Greece belonged in the eurozone and there were no plans for it leaving, following talks in Paris with German Chancellor Angela Merkel.

"Greece is in the eurozone and it must remain in the eurozone," he told a joint news conference with Merkel.

Merkel said German politicians were "very much geared towards Greece remaining in the euro", adding that the Greek people had "made a lot of sacrifices" to do so.

However, she said there was a need for "significant improvements in the substance" of the Greek request ahead of a vote in the German parliament next week.

Ahead of the Eurogroup meeting, Varoufakis said he hoped there would be a deal struck. Earlier on Friday the German government's stance appeared to soften after a spokeswoman for Merkel said Greece's request for a loan extension from its eurozone partners provided "a starting point" for more talks.

"From the German government's point of view, [the request] is still not sufficient," said Christiane Wirtz. But "it certainly offers a starting point for further talks."

One Greek government official described the phone call as "constructive", adding: "The conversation was held in a positive climate, geared towards finding a mutually beneficial solution for Greece and the eurozone." Germany stands to lose up to €80b ($90.9b) if Greece were to leave the eurozone.