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| Eurozone Leaders Work Past Midnight Deadline on Greece | |
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| BRUSSELS — European leaders worked through a self-imposed midnight deadline and into Monday in the face of deep divisions over giving Greece another bailout and holding their common currency together. | |
| The mood grew increasingly tense as the hours ticked past, as the leaders debated among themselves and with the Greek government over plans that would require Athens to make new concessions and adopt a raft of economic policy changes within two days to qualify for the aid the country needs to remain afloat financially. | |
| Among the options on the table were steps that Greece’s left-wing government, while desperate for a deal to pave the way for new funding, would probably find difficult to sell at home to voters who last week resoundingly rejected further austerity. | |
| They included a temporary Greek exit from the eurozone, and placing the proceeds from privatizations of Greek assets worth 50 billion euros in a fund in Luxembourg to help pay down Greece’s huge debt. Similar options were first put forward in a policy paper prepared by the German finance ministry, and they have since stirred an angry response from some Greek officials, who signaled that there were elements of the European demands they could not accept. | |
| Going into the meeting, the leaders were deeply split, with some saying the priority was to hold Europe together and others suggesting that they had so little trust in Greece to live up to its commitments that a deal would be difficult if not impossible. Failure to find some compromise could lead to Greece leaving the euro, throwing into reverse for the first time a quest for ever-closer European unity stretching back more than half a century. | Going into the meeting, the leaders were deeply split, with some saying the priority was to hold Europe together and others suggesting that they had so little trust in Greece to live up to its commitments that a deal would be difficult if not impossible. Failure to find some compromise could lead to Greece leaving the euro, throwing into reverse for the first time a quest for ever-closer European unity stretching back more than half a century. |
| The options being debated by the leaders amounted to demands that Greece move quickly and forcefully to reestablish trust and credibility with its creditors after years of failure to follow through on promised changes and months of bitter wrangling over the country’s need for more money to keep it afloat. But they also included the possibility of what a draft assessment of options by the eurozone finance ministers called “a timeout from the euro area,” accompanied by discussions about reducing Greece’s crippling debt load. | The options being debated by the leaders amounted to demands that Greece move quickly and forcefully to reestablish trust and credibility with its creditors after years of failure to follow through on promised changes and months of bitter wrangling over the country’s need for more money to keep it afloat. But they also included the possibility of what a draft assessment of options by the eurozone finance ministers called “a timeout from the euro area,” accompanied by discussions about reducing Greece’s crippling debt load. |
| An assessment of Greece’s situation prepared over the weekend by the finance ministers put Greece’s financing needs at between €82 billion and €86 billion over the next three years. That sum is significantly larger than the €74 billion previously reported and is around €30 billion more than the €53.5 billion request made by Greece on Thursday for what would be its third bailout package since 2010. Greece already has more than €300 billion in debt. | An assessment of Greece’s situation prepared over the weekend by the finance ministers put Greece’s financing needs at between €82 billion and €86 billion over the next three years. That sum is significantly larger than the €74 billion previously reported and is around €30 billion more than the €53.5 billion request made by Greece on Thursday for what would be its third bailout package since 2010. Greece already has more than €300 billion in debt. |
| In a sign of the rapid pace of events, 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 went ahead, enveloped by dark warnings from the French president and others that failing to help Greece would mean a perilous retreat from the principles that have guided Europe since the end of World War II. | In a sign of the rapid pace of events, 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 went ahead, enveloped by dark warnings from the French president and others that failing to help Greece would mean a perilous retreat from the principles that have guided Europe since the end of World War II. |
| Arriving in Brussels for what was billed as a last chance summit on Greece after months of ill-tempered and increasingly divisive debate, President François Hollande of France warned that failure to find an agreement to keep Greece in the euro would “mean a Europe that is in retreat, a Europe that no longer moves forward.” France, he added, “will do everything to find an agreement this evening.” | Arriving in Brussels for what was billed as a last chance summit on Greece after months of ill-tempered and increasingly divisive debate, President François Hollande of France warned that failure to find an agreement to keep Greece in the euro would “mean a Europe that is in retreat, a Europe that no longer moves forward.” France, he added, “will do everything to find an agreement this evening.” |
| Mr. Hollande told reporters: “At stake is whether Greece will tomorrow be in the eurozone and also at stake is Europe.” | Mr. Hollande told reporters: “At stake is whether Greece will tomorrow be in the eurozone and also at stake is Europe.” |
| Mr. Hollande’s pleas for European unity — joined in by Prime Minister Matteo Renzi of Italy — contrasted with a far more skeptical and hardheaded position on Greece staked out by Germany. This exposed a rift between Paris and Berlin — a tandem that has traditionally powered European decision-making — over how to deal with a Greek crisis that Donald Tusk, the president of the European council, has described as “the most critical moment in our history.” | Mr. Hollande’s pleas for European unity — joined in by Prime Minister Matteo Renzi of Italy — contrasted with a far more skeptical and hardheaded position on Greece staked out by Germany. This exposed a rift between Paris and Berlin — a tandem that has traditionally powered European decision-making — over how to deal with a Greek crisis that Donald Tusk, the president of the European council, has described as “the most critical moment in our history.” |
| Sunday’s summit in Brussels followed a swirl of dramatic events that began last Sunday when Greek voters rejected further austerity measures in a referendum and then careered in the opposite direction on Thursday when Prime Minister Alexis Tsipras, leader of the radical left-wing party Syriza, submitted a plan to creditors that embraced tougher measures than those rejected by voters and his own party. | Sunday’s summit in Brussels followed a swirl of dramatic events that began last Sunday when Greek voters rejected further austerity measures in a referendum and then careered in the opposite direction on Thursday when Prime Minister Alexis Tsipras, leader of the radical left-wing party Syriza, submitted a plan to creditors that embraced tougher measures than those rejected by voters and his own party. |
| The week’s whiplash-inducing turns have turned the once taboo issue of “Grexit,” as Greece’s exit from the euro — or potentially even the European Union — is widely known in Europe, into a serious possibility that has spooked ordinary Greeks and many others beyond its borders, including senior officials in the United States. | The week’s whiplash-inducing turns have turned the once taboo issue of “Grexit,” as Greece’s exit from the euro — or potentially even the European Union — is widely known in Europe, into a serious possibility that has spooked ordinary Greeks and many others beyond its borders, including senior officials in the United States. |
| With banks in Greece closed since June 29, and cash machines running out of money, possibly as early as Monday, the outcome of the Sunday showdown between leaders will weigh heavily on a decision in coming days by the European Central Bank on whether to increase or perhaps cut off emergency funding for Greek banks. Without an infusion of cash from the Frankfurt-based European bank, Greece’s banking sector will crumble and send the country crashing out of the euro. | With banks in Greece closed since June 29, and cash machines running out of money, possibly as early as Monday, the outcome of the Sunday showdown between leaders will weigh heavily on a decision in coming days by the European Central Bank on whether to increase or perhaps cut off emergency funding for Greek banks. Without an infusion of cash from the Frankfurt-based European bank, Greece’s banking sector will crumble and send the country crashing out of the euro. |
| Chancellor Angela Merkel of Germany, arriving for the summit meeting, acknowledged that the economic plight of Greece was “extremely difficult” but said that “there will not be an agreement at any price.” She added: “the most important currency has been lost — and that is trust.” | Chancellor Angela Merkel of Germany, arriving for the summit meeting, acknowledged that the economic plight of Greece was “extremely difficult” but said that “there will not be an agreement at any price.” She added: “the most important currency has been lost — and that is trust.” |
| Noting that “nerves are stretched tight,” the German leader demand a coolheaded review of the options to ensure that “the advantages outweigh the disadvantages and that goes for the future of Greece as well as for the eurozone as whole, and for the principles of our cooperation.” | Noting that “nerves are stretched tight,” the German leader demand a coolheaded review of the options to ensure that “the advantages outweigh the disadvantages and that goes for the future of Greece as well as for the eurozone as whole, and for the principles of our cooperation.” |
| Germany’s stand, which is shared by a number of other countries, notably Finland and Slovakia, has stirred alarm that Ms. Merkel, who faces strong pressure from within her party, including from her own finance minister Wolfgang Schäuble not to give Greece more money without ironclad conditions, has put domestic political calculations ahead of Germany’s postwar commitment to the so-called European project. Mr. Schäuble is widely viewed in Greece as wanting the country out of the euro. | Germany’s stand, which is shared by a number of other countries, notably Finland and Slovakia, has stirred alarm that Ms. Merkel, who faces strong pressure from within her party, including from her own finance minister Wolfgang Schäuble not to give Greece more money without ironclad conditions, has put domestic political calculations ahead of Germany’s postwar commitment to the so-called European project. Mr. Schäuble is widely viewed in Greece as wanting the country out of the euro. |
| Instead of softening their demands after the July 5 Greek referendum, Germany, Greece’s biggest creditor, and its supporters in northern Europe and the former Soviet bloc have pushed for further austerity and demanded that the Greek parliament pass legislation in the next few days to entrench Syriza’s pledges of action. | Instead of softening their demands after the July 5 Greek referendum, Germany, Greece’s biggest creditor, and its supporters in northern Europe and the former Soviet bloc have pushed for further austerity and demanded that the Greek parliament pass legislation in the next few days to entrench Syriza’s pledges of action. |
| Peter Kazimir, the finance minister of Slovakia, which has joined Germany in taking a hard line against Greece, told reporters in Brussels that Greece needed to move quickly so that its public could know when banks will reopen “and in which currency.” | Peter Kazimir, the finance minister of Slovakia, which has joined Germany in taking a hard line against Greece, told reporters in Brussels that Greece needed to move quickly so that its public could know when banks will reopen “and in which currency.” |
| A draft assessment prepared by eurozone finance ministers after yet another round of emergency weekend meetings in Brussels called on Greece to legislate separate sets of measures by July 15 that must include “the streamlining of the VAT system and the broadening of the tax base to increase revenue” as well as “upfront measures to improve long-term sustainability of the pension system as part of a comprehensive pension reform” program. | A draft assessment prepared by eurozone finance ministers after yet another round of emergency weekend meetings in Brussels called on Greece to legislate separate sets of measures by July 15 that must include “the streamlining of the VAT system and the broadening of the tax base to increase revenue” as well as “upfront measures to improve long-term sustainability of the pension system as part of a comprehensive pension reform” program. |
| Greece would also need to legislate to ensure the independence of its state statistical agency, overhaul its civil justice system, and adopt European rules to ensure orderly closure of failing banks. And it would have to accept “continued full involvement” of the International Monetary Fund in overseeing any bailout, despite considerable animosity in Greece to the fund. | Greece would also need to legislate to ensure the independence of its state statistical agency, overhaul its civil justice system, and adopt European rules to ensure orderly closure of failing banks. And it would have to accept “continued full involvement” of the International Monetary Fund in overseeing any bailout, despite considerable animosity in Greece to the fund. |
| Gianni Pittella, the president of the second biggest political bloc in the European Parliament, on Sunday accused Mr. Schäuble, the German finance minister, of seeking to push Greece out of the single currency. “His tricks and political games risk to lead Greece to bankruptcy and to Grexit,” Mr. Pittella, the leader of the Socialists & Democrats group, said in a statement, referring to the possibility of a Greek exit from the common currency. “Mr. Schäuble and his supporters would bear this historical responsibility in front of all the European people,” he said. | Gianni Pittella, the president of the second biggest political bloc in the European Parliament, on Sunday accused Mr. Schäuble, the German finance minister, of seeking to push Greece out of the single currency. “His tricks and political games risk to lead Greece to bankruptcy and to Grexit,” Mr. Pittella, the leader of the Socialists & Democrats group, said in a statement, referring to the possibility of a Greek exit from the common currency. “Mr. Schäuble and his supporters would bear this historical responsibility in front of all the European people,” he said. |
| Mr. Tsipras, whose radical left-wing party Syriza won elections in Greece in January on promises to end austerity, showed up in Brussels without a tie, as he always does for meetings with fellow leaders, but also without his customary broad smile. “We can reach an agreement tonight if all parties want it,” a grim-faced Mr. Tsipras said, adding that leaders owed this “to the people of Europe who want Europe united, not divided.” | Mr. Tsipras, whose radical left-wing party Syriza won elections in Greece in January on promises to end austerity, showed up in Brussels without a tie, as he always does for meetings with fellow leaders, but also without his customary broad smile. “We can reach an agreement tonight if all parties want it,” a grim-faced Mr. Tsipras said, adding that leaders owed this “to the people of Europe who want Europe united, not divided.” |