EU’s Tusk says ‘last chance’ for Greek debt deal

STRASBOURG - Agence France-Presse

AFP photo

EU President Donald Tusk warned July 8 that Greece and its European partners now faced the very last chance to reach a rescue deal needed to keep debt-ridden Athens in the eurozone.

“Without unity on Greece we will wake up in four days in a different Europe; this is really and truly the final wake-up call for Greece and for us, our last chance,” Tusk told the European Parliament in Strasbourg.

Greek Prime Minister Alexis Tsipras earlier told MEPs that Athens “will tomorrow file new concrete proposals, credible reforms, for a fair and viable solution,” after five months of fruitless talks.

Left-wing Tsipras won power in January promising to end the austerity policies adopted by previous governments in return for two massive international bailouts worth 240 billion euros.

Greece’s 18 eurozone partners warned on July 7 that Athens had to come up with a convincing, concrete new program of reforms by July 9, ahead of a crunch EU summit in the weekend, or risk being forced out of the single currency bloc.

Tusk told the parliament that Tsipras’ address and the replies from MEPs showed how “divided we are on Greece”, but he urged all sides now to avoid recriminations and show each other respect.

Debts are debts, however, and must be repaid, he said, adding that the Greek crisis was not a morality story where creditors were bad and the debtor simply an “innocent victim”.

Tusk also warned again of the wider dangers facing Europe if there was no agreement and Greece crashed out of the eurozone.

 “Seek help among your friends and not among your enemies, especially when they are unable to help you,” he told the assembly, apparently referring to Russia, as Tsipras listened attentively.

Tusk has repeatedly warned that failure to resolve the crisis that has pushed Greece near to total economic collapse would have a huge negative impact on both the country and Europe’s “geo-political” situation.

As a former Polish premier, Tusk was known for his hard line on Russia and has adopted a similar stance over Moscow’s involvement in the Ukraine conflict.

Tsipras has visited Moscow several times since he came to power, meeting Russia President Vladimir Putin and highlighting the longstanding cultural and political ties between the two countries.

Meanwhile, Greece yesterday promised it would start pension and tax reforms next week, as demanded by creditors, in return for a three-year eurozone loan to drag its financial system back from the brink of collapse.

“We propose to immediately implement a set of measures as early as the beginning of next week including: tax reform related measures; pension related measures” if the loan from the European Stability Mechanism (ESM) was forthcoming, the finance ministry said in a letter to the eurozone bailout fund.

The letter, signed by new Finance Minister Euclid Tsakalotos, aimed to give Greece some breathing room to work out a new, broader bailout deal with its eurozone creditors.