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Tsipras Budges on Greece’s Debt, but Meets a Cool Response

July 5 is the referendum date .. Athens time 7 hours ahead of New York .. 7 hours behind Sydney .. lol .. smack dab middle ..

By SUZANNE DALEY and NIKI KITSANTONISJULY 1, 2015

Video 1:30
The Greek prime minister Alexis Tsipras made a televised address on Wednesday during which he said the government remained committed to reaching an agreement with its creditors. By The Associated Press on Publish Date July 1, 2015. Photo by Andrea Bonetti/Greek Prime Minister's Office.

ATHENS — An unexpected new effort by Greece to compromise with its creditors on a bailout package prompted a cool response from most of the rest of Europe on Wednesday as efforts to find a way out of the financial crisis confronting Athens remained chaotic.

On another day of twists and turns, Prime Minister Alexis Tsipras’s government said it would be willing to accept many of the terms of a bailout package that it had previously rejected, if they are part of a broader deal to address the country’s funding needs for the next two years.

While reviving hopes for a deal to end Greece’s financial crisis .. http://www.nytimes.com/interactive/2015/business/international/greece-debt-crisis-euro.html , the seeming reversal by Mr. Tsipras underscored the confusion over his strategy and the status of the negotiations.

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INSERT: Top officials of Tsipras’s Syriza party on Wednesday were stunned by his morning concessions. They were convinced
that he was about to call off the referendum — and several said that if he did so, he would lose their support.

“There’s going to be a struggle inside the party,” said one senior Syriza official, who spoke on the condition of anonymity to discuss internal party discussions.
Minutes later, Tsipras announced that the referendum would go ahead. Several party leaders later said that his speech had been delayed for three hours as they argued.
http://www.washingtonpost.com/world/europe/bankruptcy-is-a-real-possibility-in-greece-does-its-leader-have-a-plan/2015/07/01/fe6b5dec-1f68-11e5-a135-935065bc30d0_story.html
--

The sudden turn of events raised questions about what offer was still on the table for Greece, whether Mr. Tsipras would go ahead with a referendum scheduled for Sunday and, if so, what deal Greeks would actually be voting on.

Related Coverage - 10 inside

In a letter .. http://www.nytimes.com/interactive/2015/07/01/world/europe/document-tsipras-letter-to-european-leaders.html .. sent on Tuesday to the European Central Bank, the International Monetary Fund and other eurozone countries, Mr. Tsipras said Greece was “prepared to accept” a deal set out over the weekend by the creditors, with small modifications to some points of contention: pension cuts and tax increases. In the letter, released publicly on Wednesday, Mr. Tsipras linked Greece’s acceptance of the terms to a new package of aid that would need to be negotiated.

Latest Updates
5h Council of Europe Rejects Referendum as Substandard
http://www.nytimes.com/live/greek-debt-crisis-live-updates/?module=article-embed/council-of-europe-says-referendum-will-be-substandard
6h Eurozone Finance Ministers to Wait Out Greece Referendum
http://www.nytimes.com/live/greek-debt-crisis-live-updates/?module=article-embed/eurozone-finance-ministers-to-wait-out-greece-referendum

See All Updates - http://www.nytimes.com/live/greek-debt-crisis-live-updates/?module=article-embed

Mr. Tsipras went on television Wednesday afternoon, telling Greeks that they should vote no on the referendum to improve his negotiating position.

But European leaders fed up with Mr. Tsipras and in no mood for quick compromise, dashed any hopes of an immediate breakthrough.

Jeroen Dijsselbloem, the Dutch finance minister, said in a statement after a conference call of the Eurogroup of finance ministers that there would be no more discussion with Greece until after the referendum.

Related in Opinion 1 of 2


Op-Ed Contributor: What Would Thucydides Say About the Crisis in Greece? JULY 1, 2015 .. highly recommended ..
http://www.nytimes.com/2015/07/01/opinion/what-would-thucydides-say-about-the-crisis-in-greece.html

“We see no grounds for further talks .. http://www.nytimes.com/live/greek-debt-crisis-live-updates/eurozone-finance-ministers-to-wait-out-greece-referendum .. at this point,” he said.

Video 00:57 - Eurogroup Leader Won’t Budge on Greece
By Council of the European Union on Publish Date July 1, 2015. Photo by Phil Nijhuis/Associated Press.

Chancellor Angela Merkel of Germany, who met Wednesday with Prime Minister Matteo Renzi of Italy, repeated her position that there should be no negotiations .. http://www.nytimes.com/live/greek-debt-crisis-live-updates/last-weeks-offer-is-no-longer-on-the-table-merkel-says .. until after Greece holds its referendum — a vote that many European leaders hoped would amount to a rebuke of Mr. Tsipras.

“The overarching goal has always been to create a union of stability in Europe, with responsibility and corresponding rewards,” the chancellor said.

At a news conference in Berlin, Mr. Renzi appeared even more impatient with Greece than his German host did, calling the decision to hold a referendum an “error.”

Whenever further talks resume, they are likely to be complex and contentious .. http://www.nytimes.com/interactive/2015/07/01/business/international/what-key-players-are-saying-about-greek-crisis.html . An existing bailout agreement expired at midnight Tuesday, meaning that Greece and its creditors would have to start over in assembling a package of aid and budget cuts. Moreover, many European officials remain deeply skeptical about whether Mr. Tsipras’s leftist government would implement the more painful elements of any agreement.

Graphic: What Key Players Are Saying About the Greek Crisis
http://www.nytimes.com/interactive/2015/07/01/business/international/what-key-players-are-saying-about-greek-crisis.html

The European Union’s executive arm, which has played a central role in trying to broker a settlement between Greece and its creditors, dampened hopes of a swift deal by stressing that the revised terms offered by Greece addressed issues that had been raised during months of fruitless haggling over an old bailout program that is no longer under discussion.

Valdis Dombrovskis, a vice president of the European Commission, said that the expiration of the old bailout program meant that “we are now in a new situation.” Greece’s decision to close banks and impose other capital controls, he said, “make the situation much more problematic.”

He added, “Now much more damage has been done and much more effort will be needed to restore the situation.”

The European Commission, he said, still hopes for an agreement so that Greece can meet a 3.5 billion euro loan payment to the European Central Bank that is due in late July.

Video - E.U. to Wait for Greek Vote, Merkel Says 00:27
By Reuters on Publish Date July 1, 2015.

“The doors for talks are open .. http://www.nytimes.com/live/greek-debt-crisis-live-updates/european-commission-official-leaves-door-open-for-more-talks ,” Mr. Dombrovskis said, blaming Greece for upending previous negotiations with its decision to call a referendum. “There is certainly a possibility to reach an agreement before the next payments come due, but it is important that both sides have a willingness” to reach an accord, he added.

In his televised address to Greek voters, Mr. Tsipras said that despite European characterizations, the vote Sunday was simply about a deal on how to manage the country’s debt crisis and not a vote on whether to leave the euro as the country’s currency.

Greece’s Debt Crisis Explained
http://www.nytimes.com/interactive/2015/business/international/greece-debt-crisis-euro.html

The change of tone from Mr. Tsipras, who in recent days had vehemently opposed the terms sought by the creditors, came hours after Greece missed a debt payment .. http://www.nytimes.com/2015/07/01/world/europe/greece-alex-tsipras-debt-emergency-bailout.html?_r=0 .. to the I.M.F., leaving Greece effectively in default and raising the pressure on the country to find a solution to its rapidly escalating financial squeeze. With its banking system shut down and access to more aid cut off, Greece faced the prospect of further debt defaults and the possibility of being forced to abandon the euro as its currency.

The European Central Bank left the amount of emergency credit available to Greek banks at 89 billion euros after a regularly scheduled meeting that ended Wednesday, a central bank spokesman said.

An increase in the level would have exposed the European Central Bank to even greater losses if the banks are unable to repay. A decrease would have created an even more serious cash crunch and possibly caused some banks to fail.

Further action by the European Central Bank may come after the referendum. If Greeks vote not to accept the conditions, the central bank might have no choice but to stop lending to Greek banks.

The situation left unclear what Greeks would be voting on Sunday. The referendum’s wording was to ask Greeks to vote yes or no on whether they supported the terms offered by creditors last week — an offer that in effect expired with the existing bailout package on Tuesday night, and that appears to have been supplanted in any case by the offer put forward by Mr. Tsipras.

A recent poll found majority support for Mr. Tsipras’s call to vote no in the referendum, though that support shrank after the banks were closed and a cap of 60 euros per day was put on the amount that Greeks could withdraw from A.T.M.s.

The poll, by ProRata, conducted from Sunday to Tuesday, found 57 percent of Greeks said they would vote against the deal the creditors proposed, with about 30 percent saying they would vote for it, and about 13 percent saying they were not sure. After the banks closed on Monday, the gap narrowed, with about 46 percent saying they would vote against the proposals, 37 percent said they would vote yes, and 17 percent said they were not sure.

Reporting was contributed by Andrew Higgins and James Kanter from Brussels, Melissa Eddy from Berlin, Jack Ewing from Frankfurt and Dimitris Bounias from Athens.

http://www.nytimes.com/2015/07/02/business/international/greece-bailout-tsipras.html?_r=0

.. obviously tough brinkmanship from both sides with the scheduled July 5 being an important event ..

.. from previous ..

Dominique Strauss-Kahn, who headed the IMF when the memorandum was negotiated, now admits that he made mistakes and wants to rectify them: “”My proposal is the following:
Greece should get no more new financing from the EU or the IMF but it should get a generous maturity extension and significant nominal debt reduction from the official sector”