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Greece will keep repaying its debt as long as possible, government spokesman Gabriel Sakellaridis has said.

The government’s statement comes days after Interior Minister Nikos Voutsis warned Greece had run out of funds.

Gabriel Sakellaridis said Greece would maintain repayments to its EU-IMF creditors for as long as possible.

He also rejected the idea of possible capital controls that would restrict money transfers and access to savings.

Greece and its creditors must reach a deal within weeks to unlock bailout funds needed to honor debt repayments.

The leftist government was elected in January on a pledge to end austerity measures imposed as a condition of its €240 billion ($263 billion) bailout.

It has spent the past four months trying to reach a deal with creditors in the IMF, the European Union and the European Central Bank to release the final bailout tranche, worth €7.2 billion.


However, they have failed to agree over economic reforms being demanded by the creditors.Greece debts 2015

In a Greek TV interview over the weekend, Nikos Voutsis said the repayment money owed in June “will not be given and is not there to be given”.

However, Gabriel Sakellaridis said the government wanted to meet its obligations. He also said a deal would soon be reached in talks with creditors.

“That is the government’s intention and the target we have set,” he said.

“By the end of May, the start of June, to be able to have a mutually beneficial agreement.”

Gabriel Sakellaridis also dismissed the possibility of imposing capital controls if repayments were not met, as has recently been suggested by some experts and an opposition lawmakers.

Greece’s last cash injection from its international creditors was in August and the final installment of its bailout is now seen as vital.

First Greece has to meet the June 5 repayment deadline. If it fails to come to a deal with its partners, there is a fear it could default on its loans.

That could push the Greek government towards leaving the single currency, otherwise known as Grexit.

Greece has been shut out of bond markets, and has been struggling to meet debt obligations and to pay public sector wages and pensions.

The Greek government has started the transfer of €750 million ($834 million) in debt interest to the International Monetary Fund (IMF).

The move was carried out as eurozone finance ministers met in Brussels in a bid to unlock the final €7.2 billion tranche of Greece’s €240 billion EU/IMF bailout.

The eurozone finance ministers said Greece had made “progress” but more work was needed.

Greek Finance Minister Yanis Varoufakis said his country faced a cash crisis within a “couple of weeks”.

“The liquidity issue is a terribly urgent issue. It’s common knowledge, let’s not beat around the bush,” he told reporters after the talks.Greece IMF payment

The Greek government has until the end of June to reach a reform deal with its international creditors.

Its finances are running so low that it has had to ask public bodies for help.

Eurozone governments have insisted that Greece agree to economic reforms in return for further bailout funding, and there had been fears that the country could default on its latest IMF debt repayment.

However, a Greek finance ministry official was quoted as saying that the order for repayment had been executed on May 11. Almost €1 billion has been handed over to the IMF in interest payments since the start of May.

It is unclear how the Syriza-led government came up with the funds, but the mayor of Greece’s second city Thessaloniki revealed last week that he had handed over cash reserves in response to an appeal for money.

No breakthrough was expected in Brussels on Monday, but Greece was seeking a confirmation that it had made sufficient progress in negotiations.

It was hoping that part of the EU/IMF bailout money could be paid out and that the European Central Bank would restore liquidity to the country’s beleaguered banks.

In a statement, the eurozone finance ministers said they “welcomed the progress that has been achieved so far” in the negotiations, but added: “We acknowledged that more time and effort are needed to bridge the gaps on the remaining open issues.”

Eurogroup chairman Jeroen Dijsselbloem said there had to be a full deal on the bailout before Greece received any further payments.

A defiant Greece has decided to rehire thousands of public sector workers, including cleaning ladies, despite sustained pressure from its international creditors.

Greek lawmakers passed a law to give back jobs to some 4,000 workers who were laid off under severe austerity cuts.

The move comes as Athens seeks a deal on more financial aid ahead of a meeting of eurozone finance ministers on May 11.

Greece is running out of money as it has to pay €750 million ($845 million) to the International Monetary Fund (IMF) on May 12.Greece rehires public sector workers

International creditors have demanded cuts in spending, including plans to trim the civil service and privatization of state assets, in order for Greece to continue receiving loans.

On May 7, the Greek parliament adopted a bill to rehire school guards, cleaning ladies and civil servants who lost their jobs or were earmarked for dismissal under the austerity program.

In 2014, 32 cleaning ladies sacked by the Greek finance ministry came to the European Parliament in Strasbourg in France to plead their case.

The insistence of the cleaners – who were replaced by cheaper workers – made them famous all over Greece.

Yesterday’s bill in the Greek parliament does not violate the terms of a massive bailout by the EU and IMF, which allows Athens to hire one public employee for every five who leave.

However, the move – combined with the reopening of the public broadcaster ERT – is likely to face criticism from the eurozone negotiators.

The talks with the IMF and EU are expected to continue over the weekend.

EU officials say a deal is unlikely before Greece has to make the IMF payment on May 12.

Eurozone officials say no further loans will be released until further economic reforms have been agreed.

Greece needs progress at May 11 meeting because that is likely to affect the willingness of the European Central Bank to allow the continued emergency lending that is keeping Greek commercial banks afloat.

Greek Finance Minister Yanis Varoufakis insisted the country would meet May 12 deadline.

Yanis Varoufakis also rejected the view that Greece had been reckless with bailout money, saying that 91% of the bailout funds his country had received so far had been spent on repaying banks, particularly northern European banks such as Germany’s – rather than helping Greece’s economy.

Yanis Varoufakis again stressed that Greece had no intention of leaving the euro.

Greece met its deadline on May 6 for a repayment for €200 million.

Greece’s PM Alexis Tsipras has said his country is in the final, critical stretch of talks with its international creditors and that he believes an interim deal will be in place by May 9.

Greece’s objective was to find an agreement this week or next week at the latest, Alexis Tsipras said in a marathon TV interview on April 27.

Alexis Tsipras defended Finance Minister Yanis Varoufakis, who was sidelined from Greece’s negotiating team on April 27.

However, the prime minister admitted mistakes had been made in talks with EU partners.

Since Greece’s left-wing Syriza party came to power on January 25, it has sought to renegotiate the terms of the country’s €240 billion ($260 billion) bailout from the IMF and EU.Alexis Tsipras EU deal

Greece’s negotiators have so far failed to satisfy the country’s international creditors with the scope of economic reforms required before the EU hands over the latest €7.2 billion tranche of the bailout, which the government needs to pay its bills.

Yanis Varoufakis was left isolated at an EU finance ministers meeting in Latvia on April 24, skipping a state dinner and tweeting a line from late US President Franklin Roosevelt.

Describing Yanis Varoufakis as an important asset for Greece, Alexis Tsipras argued that he had annoyed his European colleagues because he spoke their language better than they did.

From now on, Greece’s negotiations will be led by another economist in the government, Euclid Tsakalotos.

In his three-hour appearance on Greece’s Star TV, Alexis Tsipras acknowledged there was a “negative atmosphere” surrounding the talks but he suggested it was all a standard part of negotiations.

Alexis Tsipras was also critical of the government’s European negotiating partners, accusing them of reneging on a verbal commitment in February to allow Greek banks to finance the government.

“I believe we are close. I believe that if no-one wants to undermine or torpedo [the talks] we are close to an accepted package,” he said.

There would be concessions, the prime minister said, such as the part privatization of Piraeus port and the leasing of 14 regional airports.

Greece is facing a €200 million debt interest payment to the IMF on May 1st and has appealed to various public bodies to provide money from their cash reserves.

The big debt interest payment to the IMF is due on May 12, when the Greek government will have to find another €750 million.

Almost half the international investors surveyed by German research group Sentix believe Greece will leave the euro in the next 12 months.

Sentix’s break-up index for Greece rose from 35.5% in March to 48.8% in April, based on a survey of around 1,000 investors.

Alexis Tsipras rejected the idea of snap elections if EU talks failed but he did say that a referendum could be held on a final deal.

According to German finance minister Wolfgang Schauble, Greece would struggle to find creditors outside the EU and IMF.

Wolfgang Schauble said Greece would be welcome to try to find investment from Beijing or Moscow, but may have difficulties.

His warning came after fears of a Greek debt default saw its borrowing costs jump 3.5 percentage points to 27%.

Greek Finance Minister Yanis Varoufakis said his government refuses to consider leaving the EU: “Toying with Grexit… is profoundly anti-European.”

Yanis Varoufakis also promised to “compromise, compromise, compromise without being compromised” to satisfy current creditors.

Wolfgang Schauble and Yanis Varoufakis were speaking at talks in Washington.

On April 15, ratings agency S&P downgraded Greece’s credit rating.

Yields also rose on longer-term Greek borrowing, with the 10-year bond yield – the amount investors demand for lending – rising one percentage point to 13%.

Wolfgang Schauble said that the Greek government needs to find creditors.

“The Europeans have said, OK, we are ready to do it [lend money] until 2020… If you find someone else, whether it’s in Beijing, in Moscow, in Washington DC, or in New York who will lend you money, ok, fine, we would be happy. But it’s difficult to find someone who is lending you in this situation amounts [of] €200 billion.”

He added that Greece must focus on increasing its competitiveness and primary surplus.Germany and Greece finance ministers

Wolfgang Schaeuble was speaking after the Greek government’s borrowing costs surged on April 16.

According to the Financial Times, Greece had made an “informal approach” to the International Monetary Fund to have its bailout repayments delayed, but had been rebuffed.

However, IMF chief Christine Lagarde said at the World Bank spring meeting in Washington: “We have never had an advanced economy asking for payment delays.

“Payment delays are analysed as additional financing granted to that country. Additional financing means additional contribution by the international community – some of which are in much direr situations than the country eventually seeking those delays.

“Payment delays had not been granted by the board of the IMF in the last 30 years and it was eventually granted to a couple of developing countries and that delay was not followed by very productive results.

“It’s clearly not a course of action that would actually fit or be recommendable in the current situation.”

Greece owes the IMF some €1 billion ($1.06 billin) in repayments next month.

Many in the markets think the Greek government will struggle to make those payments if it does not agree an economic reform package with European creditors soon.

Failure to agree a plan with creditors will mean that the country will default, a development that could force the government to put limits on money transfers and even lead Greece to leave the euro.

EU spokesman Margaritis Schinas said on April 16 that the EU was “not satisfied with the level of progress made so far” in debt negotiations.

Wolfgang Schauble had warned that he did not expect an agreement between Athens and its creditors in the next week.

However, Greek PM Alexis Tsipras on April 16 said he was “firmly optimistic” the Greek government could reach a deal with its creditors.

“Despite the cacophony and erratic leaks and statements in recent days from the other side, I remain firmly optimistic that there will be an agreement by the end of the month,” Alexis Tsipras said.

According to Alexis Tsipras, several points of agreement had been found since talks first started, including on areas such as tax collection, corruption and initiatives to distribute the tax burden on those who have the ability to pay.

HEe said the two sides still disagreed on four areas: labor issues, pension reform, an increase in value-added taxes and privatizations, which he referred to as “development of state property”.

In a later tweet, Alexis Tsipras said he was “certain that Europe will choose the path to democracy”.

Greece’s PM Alexis Tsipras has arrived in Moscow for talks with President Vladimir Putin, as his country struggles with a debt crisis.

Alexis Tsipras will also meet Russian PM Dmitry Medvedev on April 9.

Greece is embroiled in negotiations with the EU and IMF to unblock a bailout package and could run out of funds within weeks.

Greek officials have previously pointed to Russia as a possible alternative source of financial assistance.

Analysts say Russia’s own economic woes mean any help would be limited.

“Russia is not and cannot be a (EU) substitute for Greece, it can only be a supplementary option,” said Constantinos Filis from the Institute of International Relations.Vladimir Putin and Alexis Tsipras

Alexis Tsipras and Vladimir Putin are expected to discuss ties between the EU and Russia, which were badly strained by the Ukraine crisis.

Before his arrival, Alexis Tsipras described the sanctions imposed by the EU and US on Russia in the wake of its annexation of the Crimea as “a road to nowhere”.

The European Parliament President, Martin Schulz, said Alexis Tsipras should not break with the EU line on sanctions.

“Greece demands and gets a lot of solidarity from the EU. We can therefore also ask for solidarity from Greece and for this solidarity not to be ended unilaterally by pulling out of joint measures,” he told a regional German newspaper, the Muenchner Merkur.

Russia imposed a ban on many western food imports in retaliation, but Agriculture Minister Nikolai Fyodorov has said the government could consider removing three countries, including Greece, from the embargo, Russian state media reported.

Alexis Tsipras came to power pledging to end austerity, but his plans have met resistance from Greece’s EU/IMF creditors, who lent the country billions to help it avoid bankruptcy.

Greece has not received bailout funds since August 2014, with the EU and IMF dissatisfied with the pace of Greek reforms.

A Greek repayment of €448 million ($483 million) to the IMF is due on April 9.

On April 7, the Greek government said Germany owed Greece nearly €279 billion ($303 billion) in war reparations for the Nazi occupation during World War Two.

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Greece’s Finance Minister Yanis Varoufakis has said it is possible that a referendum could be held if the eurozone rejects the country’s debt renegotiation plans.

The comments came ahead of today’s Eurogroup meeting in Brussels, where Greece is to give detailed plans of its debt and growth terms.

Greek PM Alexis Tsipras reacted by urging Yanis Varoufakis to use “fewer words and more action”.

The finance ministry clarified that eurozone membership was not in doubt.

In an Italian newspaper interview on March 8 Yanis Varoufakis was asked what his options were if a deal was not agreed.

“If needed, if we encounter implacability, we will resort to the Greek people either through elections or a referendum,” he replied.Yanis Varoufakis Greece bailout referendum

This was interpreted by some as a threat to leave the eurozone if talks broke down, something the Greek government was quick to deny.

Greek officials pointed out that the words “for the euro” had been added to Yanis Varoufakis’s remarks in brackets in the article. Greece’s eurozone membership was “a given” and did not form any part of negotiations with the Eurogroup, they added.

Yanis Varoufakis later criticized the reports as “willful attempts to undermine the good course” of attempts to agree a deal with creditors.

In a widely leaked letter to the Eurogroup, Yanis Varoufakis set out seven key reforms which he hopes will appease eurozone lenders and allow the next installment of bailout money to be released.

Greece aims to save €200 million through public spending cuts, as well as streamlining bureaucracy and cracking down on tax evasion.

European Commission Vice President Valdis Dombrovskis has rejected the letter, telling a German newspaper that “a letter here or there isn’t going to change much.”

He said Greece must first implement its reforms, adding that he did not expect a deal to be completed at March 9 meeting.

Greece needs to agree terms so that it will become eligible for more credit from the eurozone and the IMF. This would in turn allow its banks to finance themselves from the European Central Bank.

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German lawmakers have voted to extend Greece bailout by another four months.

The bailout extension – approved by international creditors last week in exchange for a series of Greek government reforms – needs to be ratified by eurozone members.

Some German lawmakers had expressed doubts about the deal and there is substantial public skepticism but the vote passed easily.

It comes after police and protesters clashed during anti-government demonstrations in Athens on February 26.

They were the first such disturbances since Greece’s leftist Syriza was sworn in as the main government party exactly a month ago, promising to renegotiate the country’s debt and end austerity.

Dozens of activists hurled petrol bombs and stones at police and set cars alight after a march involving hundreds of protesters. Some carried banners calling for Greece to leave the EU and for its debt to be cancelled.

Eurozone finance ministers on February 24 approved a set of reform proposals submitted by Greece.

Photo Reuters

Photo Reuters

As the dominant economic power in the EU, Germany’s approval was regarded as crucial – and on February 27 the overwhelming majority of lawmakers granted it. A total of 542 voted for the proposals, with 32 voting against and 13 abstentions.

The vote was preceded by a ferocious debate, with catcalling and jeering.

German Finance Minister Wolfgang Schaeuble spoke in favor of the deal, telling parliament: “We Germans should do everything possible to keep Europe together as much as we can.

“We’re not talking about new billions for Greece… rather it’s about providing or granting extra time to successfully end this program.”

There has been a chorus of skepticism about the deal inside Germany – with Thursday’s edition of the largest tabloid, Bild, emblazoned with the word “No!”, adding “No more billions for the greedy Greeks!”

Hawkish elements within Chancellor Angela Merkel’s CDU (Christian Democratic Union) and its Bavarian sister party, the CSU (Christian Social Union), have portrayed the extension deal as leniency for Greece.

Wolfgang Schaeuble himself has expressed doubt about the Greek government’s commitment to reform.

However, German legislators felt they had no choice but to pass the vote, as a eurozone breakup could prove even more expensive than the bailouts and potentially undermine the credibility of the euro.

In Greece, the proposed bailout extension has also triggered dissent within the governing party.

Greek PM Alexis Tsipras has defended it, but some on the hard left have accused Syriza of going back on pre-election pledges.

Even if the bailout extension goes through Greece still faces the formidable task of trying to service its debt obligations.

Greece will need to flesh out its reform program in detail by April and prove that reforms are bedding in before receiving a final disbursement of 7.2 billion euros.

In the meantime Greece has to repay several billion euros in maturing debts, including about 2 billion euros to the IMF in March, and 6.7 bilion in European Central Bank bonds maturing in July and August.

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The Eurogroup has approved a list of reforms submitted by Greece as a condition for extending its bailout by four months, officials say.

Eurozone finance ministers said they had agreed to begin national procedures – parliamentary votes in several states to give the deal final approval.

The measures offered by Greece include combating tax evasion and reforming the public sector.

However, IMF chief Christine Lagarde said they lacked “clear assurances” in key areas.

Greece’s debt stands at more than €320 billion, and its current €240 billion bailout expires on February 28. Fresh funding will not be released until Greece’s proposals are approved in detail.

The stakes of talks over continued financial aid have been high because of fears of a Greek default that could push it out of the euro, triggering turmoil in the EU.

The main stock market in Athens rose by nearly 10% on February 24, hitting a three-month high.

The Eurogroup said in a statement: “We call on the Greek authorities to further develop and broaden the list of reform measures, based on the current arrangement, in close co-ordination with the institutions.”Greece reforms bailout extension

The European Commission and the European Central Bank (ECB) both stated that the Greek proposals were a “valid starting point”.

The agreement had “averted an immediate crisis,” said European Commissioner for Economic Affairs Pierre Moscovici.

“It does not mean we approve those reforms, it means the approach is serious enough for further discussion,” he added.

However, Christine Lagarde expressed reservations about the reform proposals.

“In some areas like combating tax evasion and corruption I am encouraged by what appears to be a stronger resolve on the part of the new authorities in Athens,” Christine Lagarde wrote in a letter to the Eurogroup.

“In quite a few areas, however, including perhaps the most important ones, the letter is not conveying clear assurances that the government intends to undertake the reforms envisaged.”

The IMF, ECB and the Commission make up the “troika” of institutions that have managed financial rescue programs for Greece since 2010.

The four-month bailout extension was agreed on Friday after several rounds of talks, pending Greece’s delivery of its reform proposals.

The deal was widely seen as a climbdown by Greek PM Alexis Tsipras. The newly elected leader of the left-wing Syriza party is trying to balance satisfying the demands of creditors with meeting his pre-election pledges.

Alexis Tsipras’ government wants to clamp down on tax evasion, corruption and inefficiency in order to fund social spending and alleviate what it calls Greece’s “humanitarian crisis”.

ECB head Mario Draghi noted that Greek commitments “differ from existing program commitments in a number of areas”.

He said there would be a need to assess whether measures rejected by Greece were “replaced with measures of equal or better quality”.

Eurogroup chairman Jeroen Dijsselbloem said the Greek government had a right to put its own “stamp” on the bailout program.

“The new government is much more aggressive on taxes and corruption, and these are excellent things,” Jeroen Dijsselbloem told Dutch radio.

“But the Greek government is perhaps too optimistic about the speed with which they can boost tax revenues.”

Greek reform proposals:

  • Combat tax evasion
  • Tackle corruption
  • Commit not to roll back already introduced privatizations, but review privatizations not yet implemented
  • Introduce collective bargaining, stopping short of raising the minimum wage immediately
  • Tackle Greece’s “humanitarian crisis” with housing guarantees and free medical care for the uninsured unemployed, with no overall public spending increase
  • Reform public sector wages to avoid further wage cuts, without increasing overall wage bill
  • Achieve pensions savings by consolidating funds and eliminating incentives for early retirement – not cutting payments
  • Reduce the number of ministries from 16 to 10, cutting special advisers and fringe benefits for officials [youtube n6Vg2JqKhUw 650]

The Greek government has submitted a list of reform proposals to its bailout creditors, the European Commission announces.

The list was received “on time”, a spokesman tweeted.

The measures include combating tax evasion and tackling fuel and tobacco smuggling.

PM Alexis Tsipras is trying to balance satisfying the demands of creditors with meeting his pre-election pledges, say correspondents.Greece bailout reforms 2015

Greece needs approval from international creditors to secure a four-month loan extension.

“In the Commission’s view, this list is sufficiently comprehensive to be a valid starting point for a successful conclusion of the review,” a source close to the European Commission told Reuters news agency.

Drafts of the list will have been seen by European officials in Brussels as they were being drawn up over the weekend, but aspects of the plan that require new social spending may well be sticking points with creditors.

Ending home repossessions and providing free medical care and electricity for those who cannot pay may become bones of contention – while the eurozone may insist pension cuts and VAT rises should continue.

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Greece has missed the February 23 deadline in sending a list of reforms aimed at securing a bailout extension to EU partners.

The Greek government will send the list on Tuesday morning, officials say.

The list must be approved by international creditors to secure a four-month loan extension.

Analysts say the deal’s collapse would revive fears Greece will exit the euro.

Minister of state Nikos Pappas says the list will include measures to fight tax evasion and trim the civil service.Greece reform list deadline

German newspaper Bild, citing an unnamed source, reports that Greece aims to recover 7.3 billion euros ($8.3 billion) with measures to combat tax evasion.

A spokesman for the German finance ministry, Martin Jaeger, was quoted as saying by Reuters news agency that Berlin expected the Greek plan to be “coherent and plausible”.

Greece agreed at a meeting with its EU and IMF lenders on February 20 to submit the list of reforms before Tuesday, February 24.

But officials said later that the Eurogroup had agreed to a delay though no reason was given.

“The list of reforms will be sent to the finance ministers of the Eurogroup on Tuesday morning, while a teleconference will take place in the afternoon,” one official told Reuters news agency.

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The Greek government is preparing to present a list of reforms to lenders in order to secure a bailout extension.

The list to be submitted on February 23 must be approved by international creditors to secure a four-month loan extension.

Analysts say a collapse of the deal would revive fears of a Greek exit from the euro.

Minister of state Nikos Pappas said the list would include measures to tackle tax evasion and streamline the civil service.

German newspaper Bild, citing an unnamed source, reports that Greece aims to recover 7.3 billion euros ($8.3 billion) with measures to combat tax evasion.Greece bailout 2015

A spokesman for the German finance ministry, Martin Jaeger, was quoted as saying by Reuters news agency that Berlin expected the Greek plan to be “coherent and plausible”.

Greece agreed at a meeting with its EI and IMF lenders on February 20 to submit the list of reforms before February 24.

Bild, Germany’s biggest-selling newspaper, was publicly attacked on February 20 by Greek Finance Minister Yanis Varoufakis who remarked about an earlier story: “One must believe @BILD’s tall stories [about Greece] at one’s peril.”

In a new article, the newspaper breaks down what it says is a tax hit list devised by the Greek government.

It will reportedly seek to raise 2.5 billion euros from the fortunes of rich Greeks, 2.5 billion from back taxes owed by individuals and businesses, and 2.3 billion from a crackdown on tobacco and petrol smuggling.

Martin Jaeger said the Greek reform plan, once received, would be examined by Greece’s three creditors – the European Central Bank, the European Commission and the IMF.

Once the three lenders had delivered their opinion, it would be discussed by eurozone finance ministers in a conference call on February 24, he said, according to Reuters.

Yanis Varoufakis has said the bailout agreement will be “dead” if the list of reforms his government is drafting is not approved.

The new Greek government, led by PM Alexis Tsipras, was elected by promising to reverse austerity.

The four-month extension deal is widely regarded as a major climb-down for PM Alexis Tsipras, who won power vowing to reverse budget cuts.

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Greece and the eurozone finance ministers have reached a deal to extend its bailout by four months after talks in Brussels.

The extension will allow Greece to negotiate a follow-up arrangement with creditors.

“The Greek authorities have expressed their strong commitment to a broader and deeper structural reform process aimed at durably improving growth and employment prospects, ensuring stability and resilience of the financial sector and enhancing social fairness,” the Eurogroup said in a statement.

Dutch finance minister Jeroen Dijsselbloem, head of the Eurogroup, said that Athens had pledged to honor all its debts.

“This is a very positive outcome,” Jeroen Dijsselbloem told a news conference on Friday night.

“I think tonight was a first step in this process of rebuilding trust. As you know trust leaves quicker than it comes. Tonight was a very important, I think, step in that process,” he added.Greece bailout extension Eurogroup

Greece had agreed to present an initial list of reform measures by February 23, Jeroen Dijsselbloem said.

Athens welcomed the deal, which a Greek government official said gave it time to negotiate a “new deal”.

“Greece has turned a page,” the official said.

“We have avoided recessionary measures.”

Greece had been seeking a six-month extension of the bailout but the Eurogroup opted for four months.

The euro gained against the US dollar on February 20 following the announcement, adding 0.3% to $1.1403, while the Dow Jones industrial average and S&P 500 struck new intraday highs.

The agreement removes the immediate risk of Greece running out of money next month.

The new deal also provides a breathing space for the new Greek government to try to negotiate longer-term debt relief with its EU creditors.

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Greece has submitted a loan extension request to the eurozone on February 19 after weeks of wrangling over its international bailout.

The country is seeking a six-month assistance package, rather than a renewal of the existing deal which comes with tough austerity conditions.

Details of the request have not been made public, but any deal is likely to differ from the current bailout conditions set by the eurozone.

Eurozone finance ministers will meet in Brussels on February 20 to discuss the move.Greece loan extension request

The Greek request includes a pledge to maintain “fiscal balance” for a six-month period, while it negotiates with eurozone partners over long-term growth and debt reduction, Reuters has reported.

The government was also reported as saying that its extension proposal was in order to give Athens enough time, without the threat of “blackmail and time deficits”, to draw up a new agreement with Europe for growth over the next four years.

Greece faces running out of money by the end of the month without a deal.

The loan request follows days of negotiations between eurozone finance ministers and Greek government’s anti-austerity Syriza party.

It will now be reviewed by the eurozone leaders, as well as representatives of the International Monetary Fund (IMF), the European Central Bank (ECB) and the European Commission.

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The European Central Bank (ECB) has agreed to raise the emergency funding available to Greek banks to €68.3 billion.

The €3.3 billion increase in the so-called Emergency Liquidity Assistance (ELA) is critical for Greece’s banks.

Depositors have been taking savings out of the country, depleting the banks’ access to cash to lend.

However, the Greek central bank is said to have requested an additional €10 billion of emergency funding.

The ECB had already raised the amount available to Greek banks by €5 billion to about €65 billion last week.

The deal will give Athens breathing space to negotiate a loan deal with its European creditors.

Greece is asking the eurozone for a six-month extension of its European loan, a Greek government official said on February 18. It would not be a renewal of the current bailout agreement, which includes strict austerity measures.ECB Greek banks assistance

On February 16, Greece rejected a plan to extend its €240 billion bailout, describing it as “absurd”.

Greece is likely to run out of money if a deal is not reached before the end of February.

“We should extend the credit program by a few months to have enough stability so that we can negotiate a new agreement between Greece and Europe,” Greek Finance Minister Yanis Varoufakis told Germany’s ZDF.

Government spokesman Gabriel Sakellaridis confirmed that meant Yanis Varoufakis would be asking for a six-month extension to Greece’s current loan.

Gabriel Sakellaridis told Greece’s Antenna TV: “Let’s wait today for the request for an extension of the loan contract to be submitted by finance minister Varoufakis.

“All along deliberations are going on to find common ground, we want to believe that we are on a good path. We are coming to the table to find a solution.”

He added the Greek government would not back down on issues that it considered non-negotiable.

German Finance Minister Wolfgang Schaeuble dismissed the Greek proposal, telling broadcaster ZDF on February 17: “It’s not about extending a credit program but about whether this bailout program will be fulfilled, yes or no.”

An impasse over the selection of a new president triggered an early election last month that swept Syriza into government.

The Greek stock exchange rose 3% on Wednesday in morning trading in Athens as news of the loan extension application emerged, but later closed up just 1.1%.

The eurozone has given Greece until February 20 to decide if it wants to continue with the current bailout deal.

Greece wants to replace the bailout with a new loan that it says would give it time to find a permanent solution to the debt crisis.

On February 17, Greek PM Alexis Tsipras called for a vote in the Greek parliament on whether to scrap the austerity program on February 20, the same day as the eurozone deadline.

“We will not succumb to psychological blackmail,” Alexis Tsipras told parliament.

“We are not in a hurry and we will not compromise.”

JP Morgan claimed over the weekend that €2 billion worth of deposits was flowing out of Greek banks each week. It estimated that if that were to remain the case, they would run out of cash to use as collateral against new loans within 14 weeks.

The bank’s estimate is based on a calculation that a maximum of €108 billion of deposits is left in Greek banks.

The most up-to-date figures from the Greek central bank show deposits dropped 2.4% month-on-month in December to €160.3 billion from €164.3 billion, marking the third consecutive monthly fall.

Dutch Finance Minister Jeroen Dijsselbloem, who is also chairing the Eurogroup meetings of eurozone finance ministers, warned on Monday night there were just days left for talks.

Jeroen Dijsselbloem said it was now “up to Greece” to decide if it wanted more funding or not.

Greece has proposed a new bailout program that involves a bridging loan to keep the country going for six months and help it repay €7 billion of maturing bonds.

The second part of the plan would see Greece’s debt refinanced. Part of this might be through “GDP bonds” – bonds carrying an interest rate linked to economic growth.

Greece also wants to see a reduction in the primary surplus target – the surplus the government must generate (excluding interest payments on debt) – from 3% to 1.49% of GDP.

In Greece last week, two opinion polls indicated that 79% of Greeks supported the government’s policies, and 74% believed its negotiating strategy would succeed.

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According to new reports, Greece is expected to request a six-month extension of its loan agreement on February 18.

The loan would not be an extension of the current bailout agreement, which includes strict austerity measures, Greek government officials were quoted as saying.

On February 16, Greece rejected a plan to extend its 240 billion euros bailout describing it as “absurd”.

Without a deal, Greece is likely to run out of money.

The eurozone has given Greece until February 20 to decide if it wants to continue with the current bailout deal.Greece bailout extension 2015

Greece wants to replace the bailout with a new loan that it says would give it time to find a permanent solution to the debt crisis.

The country’s current bailout expires on February 28. Any new agreement would need to be approved by national governments, so time is running out to reach a compromise.

Earlier Greek PM Alexis Tsipras called for a vote to scrap its austerity program on February 20, the same day as the eurozone deadline.

“We will not succumb to psychological blackmail,” Alexis Tsipras told parliament.

“We are not in a hurry and we will not compromise.”

Earlier, Germany’s Finance Minister, Wolfgang Schaeuble, said that Greece needed to make up its mind whether it wanted to extend the bailout program.

“None of my colleagues so far understands what Greece wants… whether Greece itself knows is not clear either,” he said.

Alexis Tsipras criticized Wolfgang Schaeuble, saying that the German finance minister had lost his cool on Monday.

“Not because he spoke up against the Greek government, because that is his right, but he spoke condescendingly towards the Greek people,” he said.

The Greek stock exchange closed down by 2.45%, having fallen by as much as 4% earlier in the day.

JP Morgan claimed over the weekend that €2 billion worth of deposits was flowing out of Greek banks each week and estimated that if that were to remain the case, they would run out of cash to use as collateral against new loans within 14 weeks.

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The Greek stock market fell by more than 4% at its open on Tuesday, February 17, after European finance ministers failed to reach a new deal to restructure the country’s debts.

Greek bank shares fell almost 9%, while the government’s borrowing costs rose, with the yield on a 10-year sovereign bond rising 82 basis points to 10.74%.

On Monday night, Greece rejected a plan to extend its €240 billion bailout.

Greek Finance Minister Yanis Varoufakis called the EU deal “absurd” and “unacceptable”.

However, Yanis Varoufakis declared he was ready to do “whatever it takes” to reach agreement over Greece’s bailout, despite the collapse of the talks.

He also said he was prepared to agree a deal under different conditions.

The Greek stock exchange recovered some ground as the day progressed, but at midday on Tuesday in Athens, it was still 2.25% lower.

Stock exchanges across Europe all fell in morning trade before recovering.

Germany’s main index, the Dax, was 0.35% lower and France’s blue chip index, the CAC-40, down 0.19% at mid-day.Yanis Varoufakis Greece debt deal

In the UK, which has less exposure to Greece’s debt woes, the FTSE 100 Index which also started the day lower, had risen 0.45% by lunchtime.

JP Morgan claimed over the weekend that €2 billion worth of deposits was flowing out of Greek banks each week and estimated that if that were to remain the case, they would run out of cash to use as collateral against new loans within 14 weeks.

The investment bank’s estimate is based on a calculation that a maximum of €108 billion of deposits is left in Greek banks.

The most up-to-date figures from the Greek central bank show deposits dropped 2.4% month-on-month in December to €160.3 billion from €164.3 billion, marking the third monthly fall in a row.

Dutch Finance Minister Jeroen Dijsselbloem, who is also chairing the Eurogroup meetings of eurozone finance ministers, warned on Monday night there were just days left for talks.

Jeroen Dijsselbloem said it was now “up to Greece” to decide if it wanted more funding or not.

Ahead of Tuesday’s meeting, he said: “I hope they [Greece] will ask for an extension to the program, and once they do that, we can allow flexibility, they can put in their political priorities.

“Of course, we will see whether their program remains on track. But that is the way forward. It’s really up to the Greeks. We cannot make them or ask them. It really it really is up to them. We stand ready to work with them, also [over] the next couple of days.”

Greece’s current bailout expires on February 28. Any new agreement would need to be approved by national governments, so time is running out to reach a compromise.

Without a deal, Greece is likely to run out of money.

On Tuesday morning, Luxembourg’s Finance Minister, Pierre Gramegna, called for a greater degree of compromise on both sides.

“We can’t remain in a blockade, so everyone has to move a bit, water down demands, so we can find a compromise. There are flexibilities in the program, we have to make use of them,” he said.

“When the Greeks are against the programme and don’t want to work in this framework, it will be tough.”

Yanis Varoufakis said on Tuesday ministers would “continue to deliberate”, in order to enhance the chances of a deal.

He added he wanted to achieve “a very good outcome for the average European. Not for the average Greek, the average Dutch person or the average German”.

“We know in Europe how to deliberate in such a way as to create an honourable solution out of an initial disagreement,” Yanis Varoufakis said.

Greece has proposed a new bailout program that involves a bridging loan to keep the country going for six months and help it repay €7 billion of maturing bonds.

The second part of the plan would see Greece’s debt refinanced. Part of this might be through “GDP bonds” – bonds carrying an interest rate linked to economic growth.

Greece also wants to see a reduction in the primary surplus target – the surplus the government must generate (excluding interest payments on debt) – from 3% to 1.49% of GDP.

Two opinion polls last week indicated that 79% of Greeks supported the government’s policies, and 74% believed its negotiating strategy would succeed.

Greece is ready to do “whatever it takes” to reach agreement on its bailout in the next two days, Finance Minister Yanis Varoufakis has said.

Yanis Varoufakis was speaking after talks with EU finance ministers broke down earlier than expected, with Greece describing the EU’s offer as “absurd”.

“I have no doubt that there is going to be a agreement in the end which will be very therapeutic for Greece,” he said.

Greece wants the conditions of its €240 billion bailout restructured.

Yanis Varoufakis said “within the next 48 hours” Europe would find the phrasing that was necessary to satisfy both Greece and Europe.

However, he said there was “substantial disagreement” on whether the task ahead was to complete the current program, which his government has pledged to scrap.

Yanis Varoufakis also said that he had been presented with a draft communiqué which he had been ready to sign, but that it had been withdrawn minutes before the meeting started.

The Eurogroup head Jeroen Dijsselbloem also said there was still time for Greece to agree an extension.

“There is time and ample room to agree on the terms of an extension. When I listen to my Greek colleagues talking about a bridging loan and so on – that’s a different word for an extension,” said Jeroen Dijsselbloem.

He said says another meeting was possible on February 20 but that it was “up to the Greeks”.Yanis Varoufakis Greece bailout

“My strong preference is and still is to get an extension of the program, and I think it is still feasible,” he told a press conference.

Greece’s current bailout expires on February 28. Any new agreement would need to be approved by national governments so time is running out to reach a compromise, without which Greece is likely to run out of money.

Before the meeting, German finance minister Wolfgang Schaeuble had already said he was not optimistic a deal would be reached: “The problem is that Greece has lived beyond its means for a long time and that nobody wants to give Greece money any more without guarantees.”

French Finance Minister Michel Sapin said European leaders needed to respect the political change in Athens. As he arrived in Brussels he urged the Greeks to extend their current deal to allow time for talks.

Greece has proposed a new bailout program that involves a bridging loan to keep the country going for six months and help it repay €7 billion of maturing bonds.

The second part of the plan would see the county’s debt refinanced. Part of this might be through “GDP bonds” – bonds carrying an interest rate linked to economic growth.

Greece also wants to see a reduction in the primary surplus target – the surplus the government must generate (excluding interest payments on debt) – from 3% to 1.49% of GDP.

In Greece last week, two opinion polls indicated that 79% of Greeks supported the government’s policies, and 74% believed its negotiating strategy would succeed.

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Greece has failed to reach an agreement with eurozone officials over the country’s debt crisis, though both sides said there was still hope for a deal.

Eurogroup President Jeroen Dijsselbloem said seven hours of talks in Brussels had been “constructive”.

They ended without a joint statement to outline procedural steps ahead of further talks on February 16.

Greece says its bailout deal with the EU is punitive and must end. The EU has warned Greece to abide by the deal.

Greek left-wing government says the conditions of the €240 billion ($272 billion) bailout have impoverished Greece.

It was elected on a promise to end the bailout and ease the austerity measures that have accompanied it.Greece debt talks Brussels

The government has proposed to overhaul 30% of its bailout obligations, replacing them with a 10-point plan of reforms.

However, Greece’s creditors in the EU, led by Germany, have insisted that the terms of the bailout cannot be altered.

Officials from the two sides have been locked in negotiations aimed at reaching a deal on Greece’s debt repayments that would stave off the prospect of its exit from the eurozone – a prospect viewed with fear by the markets.

Jeroen Dijsselbloem, who heads the Eurogroup eurozone finance ministers, said after the meeting on Wednesday that there had been no discussion of detailed proposals.

“We didn’t enter into negotiations on content of the program or a program, we simply tried to work next steps over the next couple days,” he said.

“We were unable to do that.”

“We had an intense discussion, constructive, covering a lot of ground, also making progress, but not enough progress yet to come to joint conclusions,” he said.

Greece’s finance minister Yanis Varoufakis struck an upbeat note, saying hours of emergency talks in Brussels had produced “very good discussions”.

Greek officials had rejected a draft agreement from the eurozone finance ministers that proposed “extending” the current bailout deal, Reuters reported.

The current EU-IMF bailout for Greece is due to expire on February 28.

The Greek government rejects the “troika” team – the EU, International Monetary Fund (IMF) and European Central Bank (ECB) – overseeing the bailout’s implementation.

It is asking for a “bridge agreement” that will enable it to stay afloat until it can agree a new four-year reform plan with its EU creditors.

Greece’s debt currently stands at more than €320 billion – about 174% of its economic output (GDP).

On February 11, thousands of left-wing demonstrators rallied in Athens in support of their government’s proposition.

The stakes of the talks over Greece’s debt are high because of fears that a Greek default could push it out of the euro, triggering turmoil in the EU.

The Greek Defense Minister, Panos Kammenos, previously said Greece might seek funding from Russia, China or the US if it failed to reach a new debt agreement with the eurozone.

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The Greek government is to present its first concrete proposals for an alternative debt plan at an emergency meeting of eurozone finance ministers in Brussels.

Greece’s left-wing government wants to overhaul 30% of its bailout obligations, replacing them with a 10-point plan of reforms.

However, EU ministers have warned that Greece must abide by existing terms.

The EU-IMF bailout for the debt-laden country expires on February 28 and Greece does not want it extended.

Instead the new Athens government is asking for a “bridge agreement” that will enable it to stay afloat until it can agree a new four-year reform plan with its EU creditors.

PM Alexis Tsipras’s government won a confidence vote on Tuesday, with the support of 162 deputies in the 300-seat parliament.Greece debts plan February 2015

The Athens stock exchange then fell by more than 3% ahead of the emergency Eurogroup meeting, during which Greece’s new leaders will unveil their controversial debt proposals.

Greece’s Syriza-led government says the conditions of the €240 billion bailout – sweeping spending cuts and public sector job losses – have impoverished Greece.

It rejects the “troika” team – the EU, International Monetary Fund (IMF) and European Central Bank (ECB) – overseeing the bailout’s implementation.

The government’s proposal for overhauling its bailout comes in four parts, according to a finance ministry source widely quoted in Greek media.

Under the first part, Greece would co-operate on 70% of its bailout conditions but wants to scrap 30% – replacing it with 10 new reforms to be agreed with the Organization for Economic Co-operation and Development (OECD). It is unclear what these would be.

The plan also includes bond swaps to reduce Greece’s debt mountain and a proposal to reduce the primary budget surplus target for this year to 1.49% of GDP, rather than the 3% demanded by its creditors.

A swift deal with the EU is unlikely. Most finance ministers, including Germany’s Wolfgang Schaeuble, are insisting that Greece must not renege on its bailout conditions.

The Eurogroup ministers will report to Thursday’s EU leaders’ summit but a deal is not expected before the finance ministers meet again on February 16.

Greece’s left-wing leaders struck a defiant tone on the eve of the key talks with the EU.

Finance Minister Yanis Varoufakis did not rule out clashing with his eurozone counterparts, saying: “If you are not willing to even contemplate a rift, then you are not negotiating.”

The stakes of the talks are high because of fears that a Greek debt default could push it out of the euro, triggering turmoil in the EU.

Greece’s debt currently stands at more than €320 billion – about 174% of its economic output (GDP).

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Greece is seeking a bridge loan rather than an extension of its bailout, PM Alexis Tsipras has said.

In an address to parliament, Alexis Tsipras also promised measures to cut bureaucratic spending and said his government would stick to all its pre-election pledges.

Alexis Tsipras’s far-left Syriza party won elections last month on a promise to end austerity measures.

EU officials have rejected his efforts to renegotiate Greece’s bailout terms.

“The bailout failed,” Alexis Tsipras said told parliament on February 8.

“The new government is not justified in asking for an extension … because it cannot ask for an extension of mistakes.”

The prime minister said that Greece wanted to service its debt.

“If our peers want so too, they are invited to come to the table of dialogue so we can discuss how to make it viable,” he added.

Greece’s current program of loans ends on February 28. A final €7.2 billion is still to be negotiated, but the new government does not want to extend the program and has already begun to roll back austerity measures.

Greek debt stands at more than €320 billion, or about 174% of the country’s economic output.

Photo Reuters

Photo Reuters

In last month’s elections Syriza fell just short of an outright majority and formed a coalition government with the centre-right Independent Greeks.

In his speech, Alexis Tsipras said the government’s “irreversible decision is to implement in full our pre-elections pledges”.

The first priority, he said, was “tackling the big wounds of the bailout, tackling the humanitarian crisis”.

That includes giving free food and electricity to those worst affected by the economic crisis, and ending an unpopular annual levy on private property.

Among other commitments outlined by the prime minister on February 8 were:

  • a gradual rise in the minimum wage to €751 by 2016
  • reinstatement of public sector employees “fired illegally”
  • creation of a new national broadcaster.

A number of measures aimed at cutting costs or raising revenue were also announced, including:

  • a new tax on large properties
  • a special portfolio to oversee fight against corruption and tax evasion
  • a pension fund using revenues from natural resources
  • cutting ministry cars and government planes.

Alexis Tsipras also repeated demands that Germany pay reparations for World War Two and repay a loan that the Nazis forced the Bank of Greece to pay when they occupied Greece.

Greece had “a moral obligation to our people, to history, to all European peoples who fought and gave their blood against Nazism”, Alexis Tsipras said.

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Greece’s PM Alexis Tsipras says he believes it will be possible to find a solution to the stand-off with the EU over his country’s debt.

Alexis Tsipras said he was “optimistic” after meeting the heads of the European Commission, European Council and European Parliament in Brussels.

The new prime minister and his finance minister are on a diplomatic offensive to reassure eurozone leaders about their plans.

Alexis Tsipras has pledged to renegotiate the terms of a €240 billion bailout.

His far-left party Syriza was elected last month on a promise to end austerity measures.

“We respect the rules of the European Union,” Alexis Tsipras said after his meetings on February 4.

“I’m very optimistic… Of course we don’t have already an agreement but we are in a good direction to find a viable agreement.”Alexis Tsipras EU talks Brussels

Speaking at the joint news conference, European Parliament President Martin Schulz described their talks as “fruitful” but said there were difficult times ahead.

Meanwhile, Greek Finance Minister Yanis Varoufakis said his talks with ECB chief Mario Draghi in Frankfurt had also been encouraging.

“We had a very fruitful discussion and exchange,” Yanis Varoufakis told reporters.

He is keen to convince the ECB that Greece’s debt payments could be linked to the performance of the economy – the more it grows the more interest Greece would pay – through the use of debt swaps.

However, a report in the Financial Times quoted officials involved in the negotiations as saying that the ECB would oppose a crucial part of his plan – the sale of short-term treasury bills to raise €10 billion.

Today’s talks were the latest in a series of European trips to reassure leaders about the plans of a government elected on January 25 on a promise of writing off most of Greece’s spiraling debt.

Alexis Tsipras’s Syriza party had also sparked alarm on the markets and among eurozone officials when it said it would refuse a new tranche of bailout funding, prompting questions about how it would finance itself.

Greece’s current program of loans ends on February 28. A final €7.2 billion is still to be negotiated, but the new government has already begun to roll back austerity measures.

Yanis Varoufakis is hoping to obtain quick cash for Greece while a new plan is agreed amongst the various eurozone members.

Eurozone finance ministers are due to meet on February 11 to discuss Greece’s debt proposals.

Earlier, Alexis Tsipras met European Commission President Jean-Claude Juncker and European Council President Donald Tusk.

Jean-Claude Juncker was expected to press Alexis Tsipras for a “technical” extension of Greece’s current deal. The Greek leader is to travel to Paris to meet President Francois Hollande later.

On February 5, Yanis Varoufakis is expected to meet Wolfgang Schaeuble, the German finance minister.

Wolfgang Schaeuble has emerged as the one of the toughest critics of the new Greek government, previously saying: “Elections change nothing. There are rules.”

German Chancellor Angela Merkel has ruled out Greece’s debt cancellation, saying creditors had already made concessions.

Greece still has a debt of €315 bilion – about 175% of GDP – despite some creditors writing down debts in a renegotiation in 2012.

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German Chancellor Angela Merkel has ruled out canceling any of Greece’s debt, saying banks and creditors have already made substantial cuts.

However, Angela Merkel told the Hamburger Abendblatt newspaper she still wanted Greece to stay in the eurozone.

Greece’s left-wing Syriza party won last weekend’s election with a pledge to have half the debt written off.

Its finance minister said the “troika” of global institutions overseeing Greek debt was a “rotten committee”.

The troika – the European Commission, European Central Bank (ECB) and International Monetary Fund (IMF) – had agreed a €240 billion ($270 billion) bailout with the previous Greek government.Angela Merkel on Greece debts

Greece’s new Finance Minister Yanis Varoufakis has refused to work with the troika to renegotiate the bailout terms and has already begun to roll back the austerity measures the creditors had demanded of the previous government.

Angela Merkel told the Hamburger Abendblatt: “I do not envisage fresh debt cancellation.”

She said: “There has already been voluntary debt forgiveness by private creditors, banks have already slashed billions from Greece’s debt.”

Greece still has a debt of €315 billion ($355 billion) – about 175% of gross domestic product – despite some creditors writing down debts in a renegotiation in 2012.

Angela Merkel insisted she did not want Greece to leave the eurozone.

She said: “The aim of our policy was and is that Greece remains permanently part of the euro community. Europe will continue to show its solidarity with Greece, as with other countries hard hit by the crisis, if these countries carry out reforms and cost-saving measures.”

On January 30, German Finance Minister Wolfgang Schaeuble warned Greece about its negotiation tactics on writing off debt.

“There’s no arguing with us about this, and what’s more we are difficult to blackmail,” he said.

Finance Minister Yanis Varoufakis refused to work with the troika, saying he would instead talk to individual organizations and EU member states.

Yanis Varoufakis has brought forward to Saturday his planned trip to Paris, where he will meet French counterpart Michel Sapin.

Greece’s current program of loans ends on February 28. A final bailout tranche of €7.2 billion still has to be negotiated.

New Greek Prime Minister Alexis Tsipras will visit Cyprus, Italy and France next week but has no plans to visit Germany as yet.

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Addressing his first cabinet meeting, Greece’s new Prime Minister Alexis Tsipras says his country will not default on its debts.

Alexis Tsipras said he would negotiate with creditors over the €240 billion ($270 billion) bailout.

“We won’t get into a mutually destructive clash but we will not continue a policy of subjection,” said the left-wing Syriza party leader.

Germany’s vice-chancellor, Sigmar Gabriel, said it was unfair of Greece to expect other states to pick up its bills.

“I cannot imagine a haircut [debt reduction],” Sigmar Gabriel said.

As Alex Tsipras made his debut cabinet speech, Greek government bond yields rose to their highest since the 2012 debt restructuring, amid investor concern that the anti-austerity coalition was gearing up for a clash with international creditors.

The Athens Stock Exchange fell by 8% in response to Alexis Tsipras’s remarks, and as it emerged that his government was putting on hold major privatization projects, including the port of Piraeus and the main power company, the Public Power Corporation of Greece.Alexis Tsipras first cabinet meeting

Greece has endured tough budget cuts in return for its 2010 bailout, negotiated with the “troika” – the European Union, International Monetary Fund (IMF) and European Central Bank (ECB).

The country’s economy has shrunk drastically since the 2008 global financial crisis, and high unemployment has thrown many Greeks into poverty.

Vowing to defend Greek dignity, Alexis Tsipras said a renegotiation of the Greek debts would aim for a “viable, fair, mutually beneficial solution”. He did not give any details.

Alexis Tsipras promised “realistic proposals” for an economic recovery and vowed to fight corruption and tax evasion. His recovery plan, he said, was aimed at preventing deficits in the future.

The new coalition government – with the right-wing but equally anti-austerity Greek Independents – was sworn into office on January 27.

Its chief economics spokesman, Euclid Tsakalotos, has argued that it is unrealistic to expect Greece to repay its huge debt in full.

The current bailout program of loans to Greece ends on February 28. There are still 1.8 billion euros of loans that could be disbursed to Greece if it meets the conditions imposed by the troika.

Economists estimate that Greece needs to raise about 4.3 billion euros in Q1 2015 to help pay its way, with Athens possibly having to ask the IMF and eurozone countries.

Sigmar Gabriel, who is also economy minister and leads the junior partner in Angela Merkel’s coalition government, said: “Our aim must be to keep Greece in the eurozone but solidarity and fairness work both ways.”

“Citizens of other euro states have a right to see that the deals linked to their acts of solidarity are upheld,” he said.

“Every country in Europe has its own history and cannot separate itself from this through new elections.”

Sigmar Gabriel urged the Greek government to talk to its partners before going ahead with decisions such as halting the privatization of the port of Piraeus.

“Things that Greece itself won’t do cannot be shunted on to the taxpayers and employers in neighboring states,” the German Social Democrat leader said.

Greek 10-year bond yields climbed above 10%, reflecting fears that investors may not get their money back.

The yield of a bond is inverse to its price: as the price goes down, the yield grows.

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