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Greek bailout extension talks collapse

Greek finance minister Yanis Varoufakis has rejected an EU offer to extend the country’s current €240bn (£178bn) bailout, describing the plan as “absurd” and “unacceptable”.

Varoufakis was elected last month as part of Greece’s new anti-austerity Syriza government on a pledge to renegotiate the country’s debts to Eurozone economies after almost five years of loans.

The collapse of negotiations comes with deadlines looming – Greece’s current bailout programme ends on 28 February.

In a press conference after talks ended, Jeroen Dijsselbloem, chairman of the Eurogroup of finance ministers said: “My strong preference is and still is to get an extension of the programme, and I think it is still feasible.”

Dijsselbloem added: “We can use this week, but that’s about it.

“There was a very strong opinion across the whole Eurogroup that the next step has to come from the Greek authorities.”

According to Varoufakis, Greece would have been willing to agree on an offer to prolong the programme for four months previously presented by European Commission economic chief Pierre Moscovici. However, he says the offer has subsequently been withdrawn.

Rather than extending its existing bailout programme, Greece is seeking a short-term loan to allow it to pay off maturing bonds alongside a debt refinancing driven by bonds linked to its GDP.

Despite the collapse of talks, Varoufakis said he was optimistic a deal would still be secured.

“Europe will do the usual trick: It will pull a good agreement or an honourable agreement out of what seems to be an impasse,” he said.

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Comments

There are 13 comments at the moment, we would love to hear your opinion too.

  1. Michael.White.BoutiqueCapital - Bridging Loans 17th February 2015 at 9:05 am

    Its really all about what Germany wants…. A deal will be done.

  2. 32 Years of Hurt ... 17th February 2015 at 9:24 am

    The whole concept of a union where, in football terms, Conference League rated countries can feed at the same troughs as Premier League countries was a disaster waiting to happen. Until our honourable MEP’S realise and accept their mistakes the situation will only get worse.

  3. Really Greece (and some others) never should have been in, in the first place.

    Basically Greece is now a cancer and the rest of the Eurozone should face up to the fact that it is a terminal cancer. So it is probably best to cut it out before others are infected.

    Stop the pussyfooting and kick them out. It might be painful in the short term, but it might just get things on the right track in the longer term and serve as a salutary lesson to others.

    If you borrow money you have to pay it back. If that means that you have to pay tax and not pay pensions at 55 at 80% of salary – then so be it. Or go bankrupt and take the consequences.

    Who’s for a nice cheap Greek holiday next year?

  4. Greece wants another €5Bn but on its own terms, not those of the body from whom it wants it. Sorry Greece, no can do. As suggested above, Greece has become an economic cancer for the EU and the sooner it’s cut out the better. It’ll be the lesser of two evils.

  5. Greece is a textbook case of what happens when people and corporations don’t pay tax. It starts at the top with evasion and avoidance, and then worksdown through the system until everyone not on PAYE start seeing tax as voluntary.

  6. The EU is a disaster never mind Greece. Who on earth came up with a currency concept that tied the weakest economies to the strongest and thought it would work? It didn’t take much to work out that Greece was already a basket case and they’re not alone. Where next?

  7. Looks like all the posters above are pretty much in agreement (including me)

  8. Blimey, that’s twice in one morning I have agreed with you Harry. Maybe I might use a different choice of words and analogy but in principle Rock on Katzman!

  9. @ Brian

    It must be old age! I must be mellowing.

    See you on the Greek beach!

  10. Interesting to see if either side will blink first on this. Greece CANNOT back down and continue with its previous arrangements – thats political suicide given the pre & post election promises. I can t see how the EU CAN give in to their requests/demands, call it what you will. Not so much because of Greece in itself, its the principle that one EU member can try to get of current arrangements. If they do, other bigger but weak Eurozone economies could jump on the band wagon and why would they not wish to do likewise? This could see the snowball start to gather in size with the poop hitting the fan. The contagion could spell catastrophe for the Eurozone which they will want to avoid no matter what. Too many gravy trains and power ego trips involved at all levels to allow the latter to happen.
    My money is on neither side moving and then Grexit, come Feb 28th, the re-instatement of the drachma as of March 1st with the following months of political manoeuvring and each side blaming the other for the outcome.
    As always, just my humble opinion

  11. It is precisely opined that time is running out both for Greek and EU to avoid catastrophe. Astrologically speaking, the planetary influences representing through material entities against the compromise are growing stronger by the day. Those planetary influences through material entities for compromise are growing weaker. Conclusion is obvious and not far.

  12. I am always amazed that intelligent people seem to say compromise will be done at the last minute. In the case of Greece V Germany a compromise will end up in ‘political suicide’ for the Greek or German government so my money is on Germany and Greece will leave the Euro.
    That will help David Cameron get at least one country to help him when he tries to negotiate our exit strategy from EU.

  13. I applaud Neville Chamberlain for trying, but sometimes, the compromise on paper isn’t quite what you’d hoped for in practice.

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