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BRUSSELS — Greece’s newly installed finance minister arrived here at a crucial meeting of his eurozone peers on Tuesday without the new bailout proposal the group had expected to receive.
BRUSSELS — Greece’s prospects for staying in Europe’s currency union darkened on Tuesday after the new Greek finance minister showed up for an emergency meeting in Brussels without a specific new proposal, leaving European finance ministers aghast and unable to judge whether a deal for another bailout package was possible.
The apparent setback — another day with no specificity from Athens — might do little to persuade Greece’s many critics in the eurozone that there is any hope of salvaging debt negotiations that broke off nearly two weeks ago, just before Prime Minister Alexis Tsipras of Greece called for a public referendum on the issue.
Greece’s failure to present a detailed plan at a meeting called to review its demands after a referendum on Sunday turned what had been billed as a last-chance opportunity for Greece into yet another display of the substantive and stylistic gulf between the left-wing government of Prime Minister Alexis Tsipras and his country’s big creditors, starting with Germany and other European countries that use the euro.
Instead of presenting a specific proposal on Tuesday for how Greece might receive new financial aid from the other eurozone countries in return for changes in taxing, spending or parts of the economy, the Greek official, Euclid Tsakalotos, told a gathering of eurozone finance ministers that Athens would send a letter later Tuesday requesting a new bailout program.
The new finance minister, Euclid Tsakalotos, signaled that Greece would put a plan forward as soon as Tuesday night, and a government official said later that Greece was seeking a short-term infusion of new aid to help it make big debt payments due this month.
Some of the finance ministers expressed their frustration at what they considered a further delay by Greece, according to a person with direct knowledge of the meeting who spoke on condition of anonymity because of the sensitivity of the proceedings.
But the absence any clear and detailed plan from Greece about how it intended to get out of a crisis that has left its banks closed for more than a week and led it to become the first developed nation to default on loans from the International Monetary Fund diminished hopes that a gathering late Tuesday in Brussels of European leaders might end the standoff between Greece and its creditors.
The lack of progress in the afternoon meeting of the Eurogroup of finance ministers did not bode well for an evening summit of eurozone leaders who were gathering here, also to discuss Greece.
Arriving in Brussels for the summit meeting, Chancellor Angela Merkel of Germany said there “there still is not a basis” to even start negotiations on a new funding for Greece from the European Stability Mechanism, a European bailout fund. She warned that no decisions would be taken by leaders despite the rising urgency of Greece’s need for fresh money to stave off a financial meltdown.
Chancellor Angela Merkel of Germany was not optimistic, as she arrived for the summit Tuesday evening, saying there was no basis for negotiations after the Greek vote on Sunday.
“I say it is no longer about weeks, but a matter of days,” Ms. Merkel said.
The head of the Eurogroup, Jeroen Dijsselbloem, said that the finance ministers would reconvene on Wednesday by teleconference to discuss the plan Greece submits.
Mr. Tsipras, who was also in Brussels for the meeting, grinned at reporters but declined to comment.
“There were no new proposals at this point from the Greek minister,” Mr. Dijsselbloem told journalists after the Eurogroup meeting.
Joseph Muscat, the prime minister of Malta, publicly vented his frustration at the lack of a formal proposal from Athens on his Twitter account, saying it “doesn’t help this evening’s #Eurozone leaders’ meeting.”
Mr. Dijsselbloem, his voice slightly hoarse, said he expected the letter from the Athens government to request support for Greece from the European bailout fund, the European Stability Mechanism.
Still, no one wants to take the blame for a possible sudden, chaotic Greek departure from the eurozone. That means that all sides seem ready to keep talking even as the crisis reaches new levels of intensity, and even as Greece hurtles toward a deadline — a payment of 3.5 billion euros, or about $3.8 billion, to the European Central Bank on July 20 — that most analysts think it cannot miss without leaving the eurozone.
Mr. Dijsselbloem said the institutions that oversee Greece’s compliance with the terms of its previous bailouts would, as a first step, be asked to examine the proposals. After the institutions give their opinion, “we will see whether we can formally start the negotiations,” Mr. Dijsselbloem said. “All this has to be done in a matter of days and we have very little time as you are all aware.”
A senior European official said he expected 19 euro area finance ministers and also national leaders to assemble again on Sunday so long as Greece submitted concrete and viable proposals.
Going into the meeting, Mr. Dijsselbloem had been much more upbeat. But like other European officials who said they were willing to listen to the latest Greek bailout proposal, Mr. Dijsselbloem had indicated that the onus was on Athens to offer something new and specific.
The day’s events continued what has become a pattern of crossed wires and mutual incomprehension between Greece and its creditors, frustrating expectations that the dismissal on Monday of Yanis Varoufakis, a combative former professor, as Greek finance minister might drain some of the poison or at least uncertainty from Greece’s tumultuous relations with the rest of Europe.
“It’s going to be very difficult, but we will await new proposals from the Greek government,” Mr. Dijsselbloem said before the meeting of 19 finance ministers.
But Mr. Varoufakis’s replacement, Mr. Tsakalotos, surprised his peers by turning up for the emergency meeting with only a vague outline of Greece’s proposal for breaking the long standoff. A person with direct knowledge of the talks, who requested anonymity because of the sensitivity of the closed-door meeting, said that Mr.Tsakalotos had at least struck a far less abrasive tone than his predecessor and seemed open to constructive discussion.
After the referendum, held on Sunday, in which a previous eurozone bailout offer was rejected over its austerity demands, Greece is trying to reach a new arrangement as the government and banks are quickly running out of money. Because its previous international bailout program expired before Athens could receive a loan payout of 7.2 billion euros, or about $7.9 billion, the negotiations for any new aid program are essentially starting from scratch.
Some of the finance ministers, summoned to Brussels on Tuesday for a sixth crisis meeting in three weeks, expressed their frustration at what they considered a further delay by Greece, according to a person with knowledge of the meeting. Greece late last month infuriated fellow European countries by calling off negotiations as they came close to yielding a deal and announcing it would instead call a referendum on creditors’ terms that the Tsipras government then denounced as unacceptable and the work of “extremist conservative forces.”
That is why even as Mr. Dijsselbloem and other European officials — including Prime Minister Manuel Valls of France and the European Commission president, Jean-Claude Juncker — on Tuesday said they were willing to listen to what the Greek government had to say, they tended to express friendly skepticism.
Jeroen Dijsselbloem, the president of the Eurogroup, a grouping of finance ministers from the 19 countries in Europe’s common currency union, told reporters after the latest crisis meeting ended without any decisions, “There were no new proposals at this point from the Greek minister.”
“Now is the time to get around the table again,” Mr. Juncker said in a statement to the European Parliament in Strasbourg, France, alluding to Greece.
Before the meeting, Mr. Dijsselbloem said that finding a way out of an impasse that threatened to send Greece crashing out of the currency union would be “very difficult” and stressed that this depended on Greece presenting solid new proposals quickly to replace ones put forward by creditors last month but rejected by Greek voters in Sunday’s referendum.
“In Europe, there are no simple answers,” he said. “Europe is all about compromise, and this takes time.”
A Greek government official, speaking in Athens on the condition of anonymity, said the Greek proposals, once they arrived in Brussels, would be a revised version of measures submitted early last week in a letter from Mr. Tsipras to creditors. Those proposals largely matched the ones Mr. Tsipras called on Greek voters to reject. But the official, without elaborating, said the revised offer would reflect the outcome of Sunday’s referendum.
But time is what Greece does not have. And some of the eurozone finance ministers were openly hostile to the idea of reopening negotiations.
The official also said that Mr. Tsipras had spoken by telephone on Tuesday with President Obama and explained Greece’s position.
Peter Kazimir, the Slovak finance minister, told reporters before the meeting that “prolonging these debates and discussions would be detrimental to Greece and to the eurozone as a whole.” He said a near-term promise of debt relief, a central demand by Athens, was a “red line” and “absolutely impossible.”
Greece’s departure from the euro would not necessarily destabilize other weaker members of the eurozone or spread havoc in global markets, which have so far reacted relatively calmly to Greece’s troubles. But it would upend one of the European Union’s fundamental principles, a commitment to “ever closer union” in place since 1957, and throw into reverse decades of steady integration.
The German finance minister, Wolfgang Schäuble, long the most outspoken skeptic of Greece’s ability to come up with a workable plan, also rejected the suggestion of debt reduction for Greece, saying it was not allowed under European regulations. As he headed into the meeting, Mr. Schäuble insisted that without a new agreement there would be no financial assistance for Greece, which “fought successfully to reject” such a deal.
Greece’s delay in outlining what it wants, the latest in a long series of surprise moves by Greek negotiators that have shredded the European Union’s rigid procedures and etiquette, means that Athens lost at least another day in an already tight schedule to try to break months of deadlock and unlock funding so that it can reopen its banks and avoid a potentially calamitous financial collapse.
“We respect that, but without a program, there is no way to help Greece within the eurozone,” Mr. Schäuble said.
Asked whether the Greeks could retain the euro currency, Mr. Schäuble threw the question back, saying, “You have to ask the Greek government.”
The finance ministers were meeting ahead of an emergency summit meeting of the 19 leaders of eurozone countries, including Mr. Tsipras. Also expected to attend was Mario Draghi, the president of the European Central Bank, another of Greece’s big creditors. Mr. Dijsselbloem was also expected to be at the evening meeting, presumably to report on the afternoon’s proceedings.
Without a positive progress report from the afternoon session, there might be few prospects for the leaders to reach any sort of agreement with Mr. Tsipras.
Joseph Muscat, the prime minister of Malta, publicly vented his frustration at the lack of a formal proposal from the Greek finance minister, writing on his Twitter account that it “doesn’t help this evening’s #Eurozone leaders’ meeting.”
Still, no one presumably wants to take the blame for a possible sudden, chaotic Greek departure from the eurozone. That means that all sides could agree to keep talking even as the crisis reaches new levels of intensity, and even as Greece hurtles toward a deadline — a payment of €3.5 billion to the European Central Bank on July 20 — that most analysts think it cannot miss without leaving the eurozone.
“Today’s eurozone summit should be another crossroads for either a last-minute compromise or some kind of Grexit,” Carsten Brzeski, the chief economist at the bank ING-DiBa in Frankfurt, wrote on Tuesday in a briefing note, using the term for Greece’s exiting the euro currency bloc. “However, the biggest hurdle to such a compromise is the bad blood spilled on Brussels’s carpets over the last five months.”
Senior German officials dug in their heels on Monday, saying a vote by Greeks to reject further austerity in a referendum last weekend did not oblige other countries in the eurozone to change their positions.
But the finance ministers on Tuesday were having their first chance to hear from Mr. Tsakalotos, who took over from his combative predecessor, Yanis Varoufakis, on Monday.
Mr. Tsakalotos has been coordinating negotiations between Greece and its creditors since April, and his presence at the Eurogroup could provide a welcome change of tone after ministers grew weary of Mr. Varoufakis’s hectoring style and long lectures.
The Eurogroup was also meeting just days after the International Monetary Fund concluded that Greece must have some form of debt relief — a central demand by Athens.
But eurozone ministers have shown little sign of willingness to concede debt relief before Greece carries out promised overhauls in areas like taxation and pension spending. The Eurogroup has also flatly refused to open any formal negotiations with Greece on its application for a third bailout package from a eurozone bailout fund, the European Stability Mechanism.
Eurozone member states have already lent €184 billion to Greece as part of two international bailouts since 2010. The rescues have totaled €240 billion, including contributions from the International Monetary Fund and the European Central Bank.
Mr. Tsipras let the country’s second bailout package lapse last month when creditors thought a deal was close at hand. Instead, he chose to call Sunday’s surprise referendum, which was seen as a betrayal by some senior European Union officials.
There are also concerns over whether Mr. Tsipras would ever put in place the conditions that creditors have demanded as the basis for any deal.
Ms. Merkel emphasized on Monday that just as Greek voters had a right to make their voices heard, the views of other democracies in the European Union also had to be respected. Some senior European Union officials have made it clear that offering Greece leniency could be the wrong approach, since formerly beleaguered countries in the eurozone like Ireland and Portugal had experienced major progress as a result of the disciplinary budgetary discipline and structural changes prescribed by the creditors.
A failure to make good on the July 20 bailout payment to the European Central Bank would make it almost inevitable that Greece would have to cut a lifeline for the country’s cash-drained banks. And that could force the country to print a parallel currency that would hasten its departure from the currency bloc.
“If there is no progress whatsoever this week, the prospects for Greece staying in the eurozone would become grim,” said Nicolas Véron, a senior fellow at Bruegel, a research organization in Brussels.
“If there is no progress whatsoever this week, the prospects for Greece staying in the eurozone would become grim,” said Nicolas Véron, a senior fellow at Bruegel, a research organization in Brussels.
The continuation of emergency funding for Greek banks by the European Central Bank “is clearly dependent on the likelihood of an agreement between Greece and its creditors,” Mr. Véron said. But if that source of aid is “stopped and no agreement is in sight,” he added, “it is difficult to imagine a scenario in which Greece stays in the eurozone for long.”
The continuation of emergency funding for Greek banks by the European Central Bank “is clearly dependent on the likelihood of an agreement between Greece and its creditors,” said Mr. Véron. But if that source of aid is “stopped and no agreement is in sight, it is difficult to imagine a scenario in which Greece stays in the eurozone for long,” he said.
In a sign of how the previously taboo topic of “Grexit” — Greece’s exit from the euro — has surfaced as a serious option, Pierre Moscovici, the European Commission’s senior official responsible for economic and financial affairs, said early on Tuesday that this possibility “must absolutely be avoided.” The commission, he said, could “not resign itself to Grexit.”
But finance ministers were in some cases more accepting, even encouraging, of the idea that Greece should leave. Janis Reirs, finance minister of Latvia, a small Baltic nation that endured its own grinding austerity program and has now returned to economic growth, said he welcomed a possible Greek departure.
“If in a system there is an element that doesn’t work, the departure of this element won’t harm the system and in some cases can even be positive,” Mr. Reirs said in response to a question about whether Greece might have to ditch the euro.
He voiced bafflement at Greece’s hostility to measures that Latvia and other countries like Spain and Portugal have taken to rescue their own economies. “Latvian people do not understand the Greek people,” he said.
