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Tsipras Declares Creditors’ Debt Proposal for Greece ‘Absurd’ Tsipras Declares Creditors’ Debt Proposal for Greece ‘Absurd’
(about 3 hours later)
Prime Minister Alexis Tsipras declared on Friday that his government would not accept a new bailout plan proposed this week by Greece’s creditors, telling a cheering assembly of the Greek Parliament in Athens that he would not allow the creditors to “humiliate” the country.Prime Minister Alexis Tsipras declared on Friday that his government would not accept a new bailout plan proposed this week by Greece’s creditors, telling a cheering assembly of the Greek Parliament in Athens that he would not allow the creditors to “humiliate” the country.
“Greek people should be proud, because the government is not going to give in to absurd proposals,” Mr. Tsipras said.“Greek people should be proud, because the government is not going to give in to absurd proposals,” Mr. Tsipras said.
Despite the rhetoric, Mr. Tsipras said he believed Greece and its creditors were “closer than ever” to an agreement, noting that “it is clear now to everyone” that Greece’s plans are “realistic.”Despite the rhetoric, Mr. Tsipras said he believed Greece and its creditors were “closer than ever” to an agreement, noting that “it is clear now to everyone” that Greece’s plans are “realistic.”
The government’s negotiating strategy will “soon bear fruit,” he said.The government’s negotiating strategy will “soon bear fruit,” he said.
He called on the government’s opposition members, who include former Prime Minister Antonis Samaras, to declare whether they would support the deal being offered by Greece’s international creditors — the International Monetary Fund, the European Central Bank and the other eurozone countries.He called on the government’s opposition members, who include former Prime Minister Antonis Samaras, to declare whether they would support the deal being offered by Greece’s international creditors — the International Monetary Fund, the European Central Bank and the other eurozone countries.
Mr. Tsipras’s defiant speech, broadcast live on national television and picked up internationally by the BBC, seemed aimed most directly at a rising faction of dissenters on the far left of his party. A number of the dissenters have called for Mr. Tsipras to repudiate the creditors’ demands or even consider holding new elections to reaffirm his government’s mandate to push back against austerity.Mr. Tsipras’s defiant speech, broadcast live on national television and picked up internationally by the BBC, seemed aimed most directly at a rising faction of dissenters on the far left of his party. A number of the dissenters have called for Mr. Tsipras to repudiate the creditors’ demands or even consider holding new elections to reaffirm his government’s mandate to push back against austerity.
The speech came a day after Greece said it would not make a scheduled debt repayment to the I.M.F. that was due on Friday. That decision bought the country some time to renegotiate a new debt deal with its international creditors but raised further uncertainties about whether an agreement could be reached.The speech came a day after Greece said it would not make a scheduled debt repayment to the I.M.F. that was due on Friday. That decision bought the country some time to renegotiate a new debt deal with its international creditors but raised further uncertainties about whether an agreement could be reached.
Drawing lawmakers’ applause Friday night, Mr. Tsipras described the creditors’ plan as including “impossible targets,” a reference to austerity measures that he said he was elected to repudiate, including higher electricity taxes and further pension cuts to help bring down Greece’s mountain of debt.Drawing lawmakers’ applause Friday night, Mr. Tsipras described the creditors’ plan as including “impossible targets,” a reference to austerity measures that he said he was elected to repudiate, including higher electricity taxes and further pension cuts to help bring down Greece’s mountain of debt.
He added that he was “unpleasantly surprised” by the proposal as it was presented to him this week in Brussels by the European Commission’s president, Jean-Claude Juncker.He added that he was “unpleasantly surprised” by the proposal as it was presented to him this week in Brussels by the European Commission’s president, Jean-Claude Juncker.
Mr. Juncker has tried to play something of a peacemaker between Athens and Greece’s creditors, many of whom are exasperated with what they see as Greek slowness in putting into effect reforms promised by the previous government in exchange for bailout loans.Mr. Juncker has tried to play something of a peacemaker between Athens and Greece’s creditors, many of whom are exasperated with what they see as Greek slowness in putting into effect reforms promised by the previous government in exchange for bailout loans.
Without a new agreement with the creditors, Greece could run out of money and default on its debts in a matter of weeks. If that happens, one big fear is that Greece either will be forced or will choose to leave the eurozone, threatening the integrity of the euro currency union.Without a new agreement with the creditors, Greece could run out of money and default on its debts in a matter of weeks. If that happens, one big fear is that Greece either will be forced or will choose to leave the eurozone, threatening the integrity of the euro currency union.
“We don’t just need an agreement, we need a solution — a solution that will end once and for all the discussion about an exit of Greece from the eurozone,” Mr. Tsipras said.“We don’t just need an agreement, we need a solution — a solution that will end once and for all the discussion about an exit of Greece from the eurozone,” Mr. Tsipras said.
Mr. Tsipras said a counterproposal that he sent to the creditors in the last week, which contained considerably easier terms for releasing some 7.2 billion euros, or about $8 billion, in fresh financial aid, was the only “realistic” plan and was the basis on which he would negotiate.Mr. Tsipras said a counterproposal that he sent to the creditors in the last week, which contained considerably easier terms for releasing some 7.2 billion euros, or about $8 billion, in fresh financial aid, was the only “realistic” plan and was the basis on which he would negotiate.
The creditors’ plan, by contrast, seemed to be some kind of “bad negotiating trick,” he said, adding that he hoped the proposal would be withdrawn.The creditors’ plan, by contrast, seemed to be some kind of “bad negotiating trick,” he said, adding that he hoped the proposal would be withdrawn.
“Let us not back down from our just demands,” he said.“Let us not back down from our just demands,” he said.
Before Greece sends creditors its counterproposals, he asked for opposition parties to offer theirs and to clarify whether they would back the creditors’ plan.Before Greece sends creditors its counterproposals, he asked for opposition parties to offer theirs and to clarify whether they would back the creditors’ plan.
Mr. Samaras took the floor and directed sharp comments at Mr. Tsipras. “You lied to the Greek people,” he said. “The country is heading toward a third memorandum” — a reference to a third bailout program.Mr. Samaras took the floor and directed sharp comments at Mr. Tsipras. “You lied to the Greek people,” he said. “The country is heading toward a third memorandum” — a reference to a third bailout program.
Greece agreed to bailout programs in 2010 and 2012, totaling €240 billion.Greece agreed to bailout programs in 2010 and 2012, totaling €240 billion.
In a second address to Parliament later in the evening, Mr. Tsipras dismissed Mr. Samaras’s comments. “There is no way this government and this Parliament will vote for a third memorandum,” he said.
Even as the prime minister braced for a domestic political uproar on Friday, he stirred international politics by speaking with President Vladimir V. Putin of Russia by telephone to discuss energy and business cooperation before Mr. Tsipras’s planned visit to St. Petersburg this month for an economic forum.Even as the prime minister braced for a domestic political uproar on Friday, he stirred international politics by speaking with President Vladimir V. Putin of Russia by telephone to discuss energy and business cooperation before Mr. Tsipras’s planned visit to St. Petersburg this month for an economic forum.
Mr. Putin and Mr. Tsipras previously held conversations about a gas pipeline project that Moscow would like to pursue with Greece, but which the United States has urged Athens to resist.Mr. Putin and Mr. Tsipras previously held conversations about a gas pipeline project that Moscow would like to pursue with Greece, but which the United States has urged Athens to resist.
The timing has raised questions about what Mr. Tsipras intends to achieve, other than sending signals that his country might have other sources of financial aid if he and his European creditors cannot come to terms.The timing has raised questions about what Mr. Tsipras intends to achieve, other than sending signals that his country might have other sources of financial aid if he and his European creditors cannot come to terms.
A Greek government official made a point of publicizing the Tsipras-Putin call.A Greek government official made a point of publicizing the Tsipras-Putin call.
The Athens stock market fell on Friday by 5 percent, pulled down by the shares of big Greek banks. Greek bonds also fell from favor, driving up yields — a measure of government borrowing costs — nearly three percentage points, to just below 24 percent on the two-year bond.The Athens stock market fell on Friday by 5 percent, pulled down by the shares of big Greek banks. Greek bonds also fell from favor, driving up yields — a measure of government borrowing costs — nearly three percentage points, to just below 24 percent on the two-year bond.
European financial markets were down broadly on Friday, partly over the Greece uncertainties.European financial markets were down broadly on Friday, partly over the Greece uncertainties.
Athens has proposed bundling the 1.6 billion euros, or $1.8 billion, it owes the I.M.F. in June into a single payment at the end of the month, largely in anticipation that a bailout deal will be reached by then, although the Fitch Ratings Agency warned Friday that the risk that Greece would default altogether on those debts “cannot be discounted.”Athens has proposed bundling the 1.6 billion euros, or $1.8 billion, it owes the I.M.F. in June into a single payment at the end of the month, largely in anticipation that a bailout deal will be reached by then, although the Fitch Ratings Agency warned Friday that the risk that Greece would default altogether on those debts “cannot be discounted.”
A missed payment, Fitch warned, could lead the European Central Bank to restrict the emergency funding it is providing to Greek banks, and could force the government to place limits on how much money depositors can withdraw from the banks.A missed payment, Fitch warned, could lead the European Central Bank to restrict the emergency funding it is providing to Greek banks, and could force the government to place limits on how much money depositors can withdraw from the banks.
Greece’s deputy social security minister, Dimitris Stratoulis, a Syriza hard-liner, told Greek television on Friday that if the country’s creditors “do not back down from this package of blackmail,” the government would “have to seek alternative solutions — elections.”Greece’s deputy social security minister, Dimitris Stratoulis, a Syriza hard-liner, told Greek television on Friday that if the country’s creditors “do not back down from this package of blackmail,” the government would “have to seek alternative solutions — elections.”
A new opinion poll on Friday showed that four in 10 Greeks supported holding new elections.A new opinion poll on Friday showed that four in 10 Greeks supported holding new elections.
The threat of new elections might be yet another bargaining tactic as Greece negotiates with creditors to try to keep further austerity conditions from any bailout deal. Opinion polls show that if elections were held today, Syriza, which swept to power on pledges to repudiate austerity, would very likely win. A victory would be the second affirmation in less than six months that the Greek electorate backs Mr. Tsipras’s anti-austerity drive.The threat of new elections might be yet another bargaining tactic as Greece negotiates with creditors to try to keep further austerity conditions from any bailout deal. Opinion polls show that if elections were held today, Syriza, which swept to power on pledges to repudiate austerity, would very likely win. A victory would be the second affirmation in less than six months that the Greek electorate backs Mr. Tsipras’s anti-austerity drive.
“If the people reaffirmed the present government, it would be more embarrassing for the Europeans” pressing for continued — even if watered-down — austerity in Greece, said Harry Papasotiriou, a professor of political science at Panteion University in Athens. “It would reaffirm the current Greek government’s mandate.”“If the people reaffirmed the present government, it would be more embarrassing for the Europeans” pressing for continued — even if watered-down — austerity in Greece, said Harry Papasotiriou, a professor of political science at Panteion University in Athens. “It would reaffirm the current Greek government’s mandate.”
Elections might also provide Mr. Tsipras with an opportunity to sweep far-left dissenters from the ranks of Syriza, by not putting them on electoral lists, Mr. Papasotiriou added.Elections might also provide Mr. Tsipras with an opportunity to sweep far-left dissenters from the ranks of Syriza, by not putting them on electoral lists, Mr. Papasotiriou added.