Facing a likely default on June 5 unless international lenders release aid blocked because he won’t impose reforms, Greek Prime Minister Alexis Tsipras plans to hold talks at a European Union leaders meeting with German Chancellor Angela Merkel and French President Francois Hollande, looking for support.
Germany is the biggest contributor to 240 billion euros ($260 million) in two bailouts from the troika of the European Union-International Monetary Fund-European Central Bank (EU-IMF-ECB) but Merkel demanded harsh austerity measures in return.
Tsipras, whose Radical Left SYRIZA party was elected in Jan. 25 snap elections on the back of promises to reverse pay cuts, tax hikes, slashed pensions and worker firings, has appealed to Merkel before for political help in dealing with the troika but gotten nowhere.
Isolated in the EU and Eurozone, Tsipras has found himself backed into a corner with his threat that a Greek default could lead to a Eurozone exit failing to move his colleagues or officials in the financial bloc who said they have instituted safeguards since the first rescue package was granted five years ago.
Tsipras and Greek Finance Minister Yanis Varoufakis several times have said a deal is near that would unblock a delayed 7.2-billion euro ($8 billion) even though he refuse to administer more measures but nothing has materialized.
With Greece running out of cash fast and unable to pay salaries and pensions beyond this month as it’s also locked out of markets by prohibitively high interest rates, Tsipras hopes Merkel and Hollande can persuade Eurozone and IMF officials to release the money on the promise he later will institute some reforms, except for pension cuts and backing off his insistence on restoring collective bargaining for workers.
Tsipras said he’ll meet Merkel and Hollande on the sidelines of a EU leaders meeting in the Latvian capital of Riga on May 21, the first day of a two-day session.
Greece’s plight won’t be on the main agenda despite Tsipras’ plea to be heard. The meeting was designed to focus on issues relating to Eastern Europe, after an earlier meeting in Riga concentrated on Greece.
Tsipras is hoping that his meeting with Merkel and Hollande will result in some kind of political gesture that will help the pace and direction of deliberations with the troika, Kathimerini said.
He’s expected to tell them he’s made as many concessions as he can without reneging on campaign promises and ask them to intervene in the negotiations to get some leniency for Greece.
The meeting will take place a day after Germany’s Finance Minister Wolfgang Schaeuble said he could not guarantee that Greece will not default.
“I would have to think very hard before repeating this in the current situation,” he said in response to a question from The Wall Street Journal and French daily Les Echos about whether he would repeat an assurance he gave in 2012 that Greece would remain solvent.
Greece said it won’t be able to repay the IMF in June without getting release of the aid. That would trigger a default and leave the coalition government, which includes the far right-wing Independent Greeks (ANEL) unable to pay workers and pensioners and likely lead to a political and economic collapse.
In Athens, State Minister Alekos Flambouraris briefed SYRIZA’s political secretariat on the course of the negotiations with reports he said any agreement would include a lower fiscal target for this year and next without more pay or pension cuts the troika has demanded.
He also said Greece would continue to push for a debt restructuring as part of the SYRIZA agenda that has already been rejected out of hand.