Merkel warns Greek reform plans require to ‘add up’
Athens waits on decision from Brussels Group over its €3bn reform plan as government fears it could run out of money in the coming weeks
Greece has to make a €450m loan payment to the IMF on April 9 Photo: © 2015 Bloomberg Finance LP
• Angela Merkel: Greek reforms need to add up
• Alexis Tsipras to address Greek parliament on progress at 6pm
• Government warns it could run out of cash by April 9 without bail-out disbursement
• How Greece pushed Europe’s creditors to the edge plan
• Europe blocks desperate Greek attempt to stay afloat
19.18
#Greece PM Tsipras mentions SIEMENS, war reparations, and the occupation loan – and says it’s only right he mentioned these in Berlin.
— The Greek Analyst (@GreekAnalyst) March 30, 2015
19.15 Contrary to reports that no list has been finalised, Greek PM isnow saying there is a version with the Brussels right now
#Greece PM: Greek govt has already submitted its own short term reforms list
— Efthimia Efthimiou (@EfiEfthimiou) March 30, 2015
19.13 Not everyone’s impressed by the rhetoric so far
So, basically, what we now witness is PM #Tsipras going on an accusatory spree against former status-quo. No substance yet. None at all.
— The Greek Analyst (@GreekAnalyst) March 30, 2015
19.12 More tough talk from the PM who has now ruled out imposing a VAT hike on the country, and promised on to unconditionally surrender to eurozone demands
* #Tsipras : GREEK BAILOUT AGREEMENT FAILED, IS PART OF HISTORY #Greece
— Advisory Desk (@advdesk) March 30, 2015
19.08
#Greece PM: It is true that we seek a compromise w our partners, but not unconditionally
— Efthimia Efthimiou (@EfiEfthimiou) March 30, 2015
Tsipras: We are seeking an honorable compromise with our partners but do not expect an unconditional surrender
— Kathimerini English (@ekathimerini) March 30, 2015
19.05 Greece’s proposed bail-out extension will include some form of debt relief, says PM Tsipras. Earlier drafts of the list included potential measures for a debt-swap with GDP linked bonds.
#Greece PM Tsipras says that w the #Eurogroup agreement of 20th Feb, the issue of debt restructuring opens up.
— The Greek Analyst (@GreekAnalyst) March 30, 2015
Greece PM Tsipras: Greek debt needs restructuring in order to ensure sustainability
— Live Squawk (@livesquawk) March 30, 2015
19.00 PM Tsipras has started off his address slamming the “incompetence” of the previous government
Tsipras says last gov’t only collected €70 mln for 100-tranche scheme for unpaid taxes, whereas coalition took in €100mln in a week #Greece
— MacroPolis (@MacroPolis_gr) March 30, 2015
#Greece PM Tsipras attacks previous gov’t for delivering very low primary surplus and a cash deficit.
— Yannis Koutsomitis (@YanniKouts) March 30, 2015
Greek PM Tsipras: Greek govt will implement its own reform plan, programme will be agreed to with partners
— Live Squawk (@livesquawk) March 30, 2015
18.58 Right, finally PM Tsipras has appeared. Just in case you want to watch and have a full grasp on Greek, here’s a link.
#Greece PM Tsipras: Majority of people supports govt’s stance in negotiations and urges us to not take even a step back
— Efthimia Efthimiou (@EfiEfthimiou) March 30, 2015
#Greece PM: Our strategy bears fruits
— Efthimia Efthimiou (@EfiEfthimiou) March 30, 2015
#Greece PM Tsipras: The society is with us, and is asking us everyday NOT to make a single step back.
— The Greek Analyst (@GreekAnalyst) March 30, 2015
18.50
Seems tweets on #IranTalks & on #GreeceTalks are now almost identical. “Round-the-clock”, “close to deadline”, “prospects uncertain”, etc
— Peter Spiegel (@SpiegelPeter) March 30, 2015
18.45 Still no sign of Alexis Tsipras, but Bloomberg are reporting a controversial Greek property tax, dubbed Enfia, will be scrapped by the new government and replaced by a “large propety levy” targetting wealthier homeowners.
Taking bets on how they are intending to re-name the ENFIA tax. Anyone? #Greece
— The Greek Analyst (@GreekAnalyst) March 30, 2015
18.20
Lots of speculation on what Tsipras may say (or announce) in his parl speech. I’ll just hear what he has to say & take it w a pinch of salt.
— Yannis Koutsomitis (@YanniKouts) March 30, 2015
18.10 Greek Prime Minister Alexis Tsipras is due in front of his parliament at 6.30pm (BST)
parliament on short break; tsipras to open party leaders’ debate at 8:30 pm.
— Diane Shugart (@dianalizia) March 30, 2015
18.00 Snippets of some elements of Greece’s proposed reforms have been doing the rounds (see 15.30). And there’s alot more where that came from, according to Greek officials in Athens.
The FT’s Peter Spiegel is reporting any final list will include upwards of 72-proposals .
#Greece govt offcial says reform list includes “lot more than what’s circulating in the media”, indirectly confirming list I tweeted earlier
— Yannis Koutsomitis (@YanniKouts) March 30, 2015
17.08 A Greek finance ministry official has denied claims the country’s reforms list will include an income tax hike or the highest earners or a raise in cigarette and tobacco levy
#Greece FinMin sources reject that there is any thought abt a fat tax or a raise on tobacco & alcohol tax
— Efthimia Efthimiou (@EfiEfthimiou) March 30, 2015
17.00 April 9 represents another crunch repayment date for the Greek government. Amid fears the country will soon run out of money to make its loan obligations, Athens is reassuring creditors it will make its obligations.
#Greece gov’t plans to service April 9 €448ml payment to the #IMF on time ~Finance Ministry official to @capitalgr
— Yannis Koutsomitis (@YanniKouts) March 30, 2015
16.30 The eurozone’s economics chief has told the European parliament creditors are working “day and night” to find a positive outcome to Greece’s bail-out hiatus.
Pierre Moscovici told the EP: “We are working with a positive spirit. It’s not simple, it’s not easy.”
Mr Moscovici, a former French finance minister, has been one of the Greek government’s most supportive EU chiefs.
EU’s Moscovici: Greek Commitments Should Be Respected -There Are Deadlines Looming For Greek Talks
— Live Squawk (@livesquawk) March 30, 2015
15.30 Bloomberg have seen the15-page draft reform list the Greeks have submitted to the eurozone today. Here’s some of the revnue-raising measures it includes:
• €875m of revenues from “intensification of audits on lists of bank transfers and offshore entities”
• €400m from streamlining income-tax rules
• €350m from auctions of television-broadcast licenses
• Between €250m – €400m from “combating illegal trade on oil, tobacco and alcohol
• €420m euro is projected from the fight against sales-tax fraud
• Plans aim to hit a primary budget surplus of 1.2pc of GDP
15.05 Some details of Greece’s reform list are dripping out. According to a government official quoted by Reuters, the government is planning to reduce early retirements, but will not hike VAT in the tourism sector.
There’s also a blueprint to create a “bad bank” to deal with non-performing loans. This would be capitalised with funds the Greek government had returned to the eurozone after its bail-out.
Greek list proposes creating bad bank to deal with bad loans by using €10.9bn in bank bailout funds returned to EZ -finmin official – RTRS
— Fabrizio Goria (@FGoria) March 30, 2015
* Greek reform list pledges to reduce early retirements, avoid vat hikes in tourism sector – finance ministry official – RTRS
— Fabrizio Goria (@FGoria) March 30, 2015
14.45 Greece’s finance minister has repeated his call for an end to the “toxic blame game” that has engulfed bail-out talks.
Writing in German business daily Handelsblatt, Yanis Varoufakis said Greece could only move forward once animosity with Europe’s largest creditor state comes to an end.
14.05 Those fuller quotes from the German Chancellor who is awaiting the verdict of the Brussels Group (like the rest of us):
“We saw this in Ireland when a new government changed parts of the programme. But in the end the financial stability of the country must be restored. Greece is talking with the institutions now. We are waiting on these talks. And we will wait for the evaluation of the institution.”
Springtime in Helsinki MT @jussisalonranta
— Peter Spiegel (@SpiegelPeter) March 30, 2015
13.33 From Ms Merkel:
* German chancellor Merkel says Greece has some flexibility to define reforms, but overall framework must make sense – RTRS
— Fabrizio Goria (@FGoria) March 30, 2015
* German chancellor Merkel says not surprised that debate over Greek reforms is taking a long time, this has always been the case – RTRS
— Fabrizio Goria (@FGoria) March 30, 2015
13.30 Some lines coming out of that press conference with Ms Merkel in Helskini. Finland’s PM forsees no forbearance for Greece…
* Finland’s stubb says time is running out for Greece, conditions for aid will not be changed – RTRS
— Fabrizio Goria (@FGoria) March 30, 2015
13.20 Germany’s chancellor is meeting with her creditor bloc partner, Finland’s Alex Stubb today. The two premiers are due to give a press conference discussing all matters Russia and the eurozone economy imminently.
#Merkel på besök i #Finland . Snart börjar presskonferensen.
— Nina Simberg (@NinaSimberg) March 30, 2015
13.10 The eurozone’s largest economy, and Greece’s largest creditor, is officially out of deflation.
German prices rose 0.1pc last month in preliminary figures released for March. Inflation across the eurozone is expected to show the bloc as a whole is still suffering from falling prices, with the rate moderating from the -0.6 registered last month.
13.05 Greece is scrambling around for cash. The country faces a €450m payment to the IMF on April 9, on top of its €1.2bn monthly wage and pensions bill.
With no indicators that the eurozone will be releasing funds any time soon, the government’s latest plans to alleviate their cash flow problems is through an audit on its foreign bank transfers. This could raise as much as €725. according to Bloomberg.
BBG Reporting That Greece Sees Revenue Of EUR725 Mln From Audits On Bank Transfers Abroad
— Live Squawk (@livesquawk) March 30, 2015
12.50 As Greece’s international creditors push for more in the way of structural reform plans from the fledgling government, Greek Prime Minister Alexis Tsipras is facing a battle with the hard Leftist elements of his party to stick by his electoral pledges.
Tellingly, one of the few legislative plans to have been put before the Greek parliament are a series of anti-poverty measures, in line with Syriza’s famed Thessaloniki program.
Mr Tsipras, whose poll support has dropped from 80pc after his election to 60pc in recent weeks, also faces Lefist opposition to continuing with privatisation of Greece’s ports, airports and power grids. The country’s energy minister, around whom many of the internal dissenters are now rallying, was however defiant over the weekend:
“Privatizations in our country, and especially in strategic areas and public property of particular importance, must not and will not occur. ..Greece cannot survive without its heart. Our country, on the contrary, needs a reconstruction of its public strategic areas as a prerequisite of a breath of air and way out [of the crisis].”
I’ll be meeting with Parliament later today to discuss the course of our negotiations. #Greece
— Alexis Tsipras (@tsipras_eu) March 30, 2015
12.15 Negotiations on the reform list begin at 1pm in Brussels. Speaking before the meeting is due, EU spokesman Margaritis Schinas is downplaying expectations
“We’re not there yet,” says @EU_Commission spox @MargSchinas on #Greece talks. #Understatement
— Peter Spiegel (@SpiegelPeter) March 30, 2015
12.05
#Grexit risk continues to rise. #Greece ‘s 5yr default probability jumps to almost 80%.
— Holger Zschaepitz (@Schuldensuehner) March 30, 2015
11.55 A measure of economic confidence in the euro-area recorded its highest level since June 2011. Things weren’t as rosy in Greece where sentiment fell of 1.4 points to 96.8m giving it one of the lowest scores on the continent for March.
#Euroboom2015 has now reached Italy. Only France and Greece left acc to economic sentiment indicator
— grodaeu (@grodaeu) March 30, 2015
Euro sentiment up. Labour reform catapults #Italy near #Eurozone top ( #Spain ). #Greece drops. http://t.co/zgOTf4xriH
— Berenberg Economics (@Berenberg_Econ) March 30, 2015
11.30
#Greece | As reported Euroworking Group wll have a teleconference on Wed to take stock of negotiations, confirms @MargSchinas /via @Elbarbie
— Yannis Koutsomitis (@YanniKouts) March 30, 2015
10.40 Conflicting reports coming from Europe today. The German finance ministry is now saying they have yet to receive a list of proposals
German FinMin spokesperson: #Greece hasn’t submitted proposals to Euro area. Talks on reforms continuing. (BBG)
— Holger Zschaepitz (@Schuldensuehner) March 30, 2015
10.15 Athens stocks are down just over 1pc today as we await news from the Brussels Group. Shares have started to recover slightly as the morning has gone on.
09.55 Greece’s outspoken energy minister is in Russia today, an indication that the hard-Leftists in the Syriza party are more than willing to make overtures to other parts of Europe, as talks stall with the EU.
Panagiotis Lafazanis, who is part of the Left Platform, of the party told a Greek newspaper over the weekend his country was on a collision course with a “Germanized Europe”.
He added that any proposals for reforms could not curtail the “will of the people and popular sovereignty” in an interview which lays out the nature of the domestic difficulties faced by Prime Minister Tsipras. Here are some excerpts:
The current Germanized establishment, despite its internal differences, is the most devastating thing for Greece, and more comprehensively, for the entire European continent. The sooner this becomes realized in practice, the better. Because, there is no time. We have no more time.
Greece is situated at a breaking point. At this hour what is required for the country, urgently and without any delay, are big and bold choices, alternatives to the Germanized Europe. The Germanized and established EU is literally suffocating our country , tightening the noose on the neck of the economy week by week.
The “realpolitik” for our government is one and one only: to remain committed and implement our radical program. The only road that is offered to us by the “institutions” does not contain the slightest realism, has been tried [in the past] and failed miserably.”
09.45 Greece’s creditors are playing “a holding game in which deliberate brinkmanship seems to combine with inexperience and incompetence.”
That’s the verdict of Berenberg on events as they’ve unfolded over the last five weeks. The bank says its possible the government could run out of money to make its state wage and pension payments before the end of April.
They also expect creditors will continue to squeeze more from Athens in the form of “structural reforms” alongside the revenue raising measures already on the table:
Higher taxes and less structural reform would the worst of both worlds, stifling the economy now and curtailing trend growth at the same time. The creditor institutions are rightly insisting on growth enhancing supply-side reform. Also, the institutions seem to share our view that, after the damage to confidence and tax receipts caused by the new government already, Greek projections for 1.5% real GDP growth this year and a primary fiscal surplus are not realistic.
09.30 So what exactly is in these Greek plans to overhaul the economy and can they finally satisfy their paymasters? According to reports widely circulated at the weekend, the list included some of the following:
• Raise VAT tax on some Greek islands
• Retain property tax
• Continue with ongoing privatisations
• Clampdowns on tax evasion
Perhaps more significantly, the reforms are not said to include enough detail about revamping VAT, raising the Greek pension age, or implementing competitive labour market reforms. These are all likely to be a sticking point for the Brussels Group (formerly known as the Troika).
It seems the list has now been sent to the ECB, IMF, and EU, but good luck finding a hard-copy
#Greece ‘s delegation at #BrusselsGroup presented reform proposals only in e-form for mobile devices and in Greek ~EU official to @tagesschau
— Yannis Koutsomitis (@YanniKouts) March 30, 2015
09.15 Hello and welcome to today’s live coverage of events in Brussels and Athens.
The Greek government spent the weekend holed up with its eurozone creditors, pouring over draft proposals to implement economic reforms in return for the bail-out cash it needs to avoid going bankrupt.
Discussions over the list are likely to continue today from around 11am, and depending on the progress made, could lead to a meeting of the eurogroup of finance ministers later this week, or potentially, after the Easter break.
#BrusselsGroup talks on #Greece bailout to resume at 1100 GMT /via @SpiegelPeter
— Yannis Koutsomitis (@YanniKouts) March 30, 2015