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Eurozone Leaders to Meet on Greece, After Finance Officials Hit Impasse Eurozone Leaders to Meet on Greece, After Finance Officials Hit Impasse
(about 1 hour later)
BRUSSELS — With just hours remaining for a deal to keep Greece in Europe’s common currency, European finance ministers resumed negotiations on Sunday after a day of fruitless talks and indicated that a decision on whether to cut Greece adrift or open the way for a new bailout would be left to a meeting later in the day of the leaders of the 19 countries that use the euro. BRUSSELS — With just hours remaining for a deal to keep Greece in Europe’s common currency, European finance ministers indicated that a decision on whether to cut Greece adrift or open the way for a new bailout would be left to a meeting later in the day of the leaders of the 19 countries that use the euro.
In a sign of mounting disarray ahead of a midnight deadline for a settlement, a full summit meeting of the European Union’s 28 heads of state planned for Sunday was abruptly canceled. But the separate meeting of eurozone leaders was still on track.In a sign of mounting disarray ahead of a midnight deadline for a settlement, a full summit meeting of the European Union’s 28 heads of state planned for Sunday was abruptly canceled. But the separate meeting of eurozone leaders was still on track.
The failure of finance ministers to reach a consensus indicates that any agreement to continue negotiations with Athens would be a largely political decision based on the goal of European unity, rather than an economic one. And it would require bridging a divide between eurozone countries, including Germany, that oppose further aid to Greece and those, including France and Italy, that say Athens still deserves a helping hand. The failure of finance ministers to reach a consensus on Saturday and when their meeting resumed Sunday morning indicates that any agreement to continue negotiations with Athens would be a largely political decision based on the goal of European unity, rather than an economic one. And it would require bridging a divide between eurozone countries, including Germany, that oppose further aid to Greece and those, including France and Italy, that say Athens still deserves a helping hand.
In an interview with a German newspaper to be published on Monday, the foreign minister of Luxembourg, which this month took over the rotating presidency of the European Union, warned of a “catastrophe for Europe” if Germany pushed Greece into leaving the euro. President François Hollande of France warned on Sunday that failure to find an agreement that would keep Greece in the euro would “mean a Europe that is in retreat, a Europe that no longer moves forward,” and he vowed that “France will do everything to find an agreement this evening.”
Such a scenario, the foreign minister, Jean Asselborn told Süddeutsche Zeitung, “would be fatal for Germany’s reputation in the E.U. and the world” and lead to a “profound conflict with France,” which has pushed for a deal to save Greece from economic and financial collapse. Mr. Hollande, arriving for the Brussels meeting, said that the future not only of Greece but of all Europe was hanging in the balance: “The stake is to see whether Greece will tomorrow be in eurozone and the stake is Europe. It is not simply a question of deciding about Greece, thought that is of course the subject of the day, but to mark out well the conception we have of Europe.”
Chancellor Angela Merkel of Germany, arriving for the summit meeting, acknowledged that the economic plight of Greece was “extremely difficult.”
But “the most important currency has been lost – and that is trust,” Ms. Merkel said. “That means that we will have tough talks today, and there will not be an agreement at any price.”
The Greek prime minister, Alexis Tsipras, struck a conciliatory tone as he arrived at the summit meeting: “I am ready for an honorable compromise. We owe it to the peoples of Europe who want Europe united and not divided. We can reach an agreement by tonight if all the parties involved want it.”
Jean-Claude Juncker, the president of the European Commission, who has been a main broker between Greece and its eurozone creditors, was still pushing for a settlement heading in the meeting. “I will fight until the very last millisecond for a deal, and I hope that we will have a deal,” Mr. Juncker told reporters.
Greece’s most stalwart ally, Cyprus, which is only just recovering from its own brush with bankruptcy and a severe banking crisis in 2013, ruled out the possibility of a fracturing of the eurozone. But less sympathetic countries, which seem to be a majority, suggested this was a real possibility.Greece’s most stalwart ally, Cyprus, which is only just recovering from its own brush with bankruptcy and a severe banking crisis in 2013, ruled out the possibility of a fracturing of the eurozone. But less sympathetic countries, which seem to be a majority, suggested this was a real possibility.
Banks in Greece have been closed since June 29, and cash machines could run out of money as early as Monday. Peter Kazimir, the finance minister of Slovakia, which has joined Germany in taking a hard line against Greece, told reporters on his arrival for Sunday’s talks that Greeks needed to know when banks would reopen “and in which currency.”Banks in Greece have been closed since June 29, and cash machines could run out of money as early as Monday. Peter Kazimir, the finance minister of Slovakia, which has joined Germany in taking a hard line against Greece, told reporters on his arrival for Sunday’s talks that Greeks needed to know when banks would reopen “and in which currency.”
Mr. Kazimir ruled out any prospect of an agreement among finance ministers, saying the most that could be expected were “recommendations for the heads of state” when the eurozone leaders gather on Sunday afternoon for an emergency, last-chance summit meeting. “The breach of trust is so deep it is not possible to reach a deal,” Mr. Kazimir said, referring to the finance officials. Mr. Kazimir ruled out any prospect of an agreement among finance ministers, saying the most that could be expected were “recommendations for the heads of state” when the eurozone leaders gathered on Sunday afternoon for a last-chance summit meeting. “The breach of trust is so deep it is not possible to reach a deal,” Mr. Kazimir said, referring to the finance officials.
A nine-hour meeting of eurozone finance ministers on Saturday broke off as Germany, Finland and Eastern Europe members expressed doubts that Greece could be trusted to live up to any commitments made in exchange for bailout assistance that might reach 74 billion euros, or nearly $82.6 billion.A nine-hour meeting of eurozone finance ministers on Saturday broke off as Germany, Finland and Eastern Europe members expressed doubts that Greece could be trusted to live up to any commitments made in exchange for bailout assistance that might reach 74 billion euros, or nearly $82.6 billion.
That finance ministers pressed Greece on Saturday to take swift action to prove that pledges made in its latest proposal to introduce tough austerity measures would be put into effect — and not left on the drawing board, as had happened with many previous Greek promises.
A failure to find a solution for Greece’s economic crisis could be the biggest challenge yet to European unity.A failure to find a solution for Greece’s economic crisis could be the biggest challenge yet to European unity.
Valdis Dombrovskis, the European commissioner responsible for the euro, told reporters Sunday morning that because it was “relatively unlikely’’ that the finance ministers could reach an agreement, they would instead “prepare and provide input for leaders discussions later.” Valdis Dombrovskis, the European commissioner responsible for the euro, had told reporters Sunday morning that because it was “relatively unlikely’’ that the finance ministers could reach an agreement, they would instead “prepare and provide input for leaders discussions later.”
If the eurozone leaders cannot reach an agreement to keep the Greek negotiations alive, the finance ministers and the European Central Bank might need to make contingency plans for addressing the social and economic fallout of the crisis in Greece, where the government is virtually out of money and the banks are on the verge of collapse.If the eurozone leaders cannot reach an agreement to keep the Greek negotiations alive, the finance ministers and the European Central Bank might need to make contingency plans for addressing the social and economic fallout of the crisis in Greece, where the government is virtually out of money and the banks are on the verge of collapse.
Last week, the president of the European Commission, Jean-Claude Juncker, said Europe would be prepared to extend “humanitarian’’ aid to Greece, if necessary. Last week, Mr. Juncker said that Europe would be prepared to extend “humanitarian’’ aid to Greece, if necessary.