Europe squeezes more reforms from Greece as Merkel steps into bail-out talks
Ceditors show no sign of alleviating pressure on cash-stricken government after late-night talks in Brussels
By Mehreen Khan
12:30PM GMT 20 Mar 2015
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Chancellor Merkel said she trusts Greece will come good on its promises
Greece's hard-Left government was told to redouble its reform efforts and begin rebuilding the trust of its eurozone partners after a marathon four-hour meeting of European leaders yesterday.
With time running out on agreeing the details of a new bail-out deal, Athens was urged to speed up its commitment to raising revenues and overhauling its economy by the leaders of France and Germany.
"We have to take that at face value and say we trust that this will happen,” said Angela Merkel, referring to the Athens' promises to meet their bail-out conditions. “And then we will see what comes."
In a welcome sign for Greece, the country's interminable debt talks are now taking place at the highest level of European diplomacy.
Previously, Greece was left to negotiate with the lower tier of European finance ministers. But relations with the Eurogroup deteriorated earlier this week after the group's chief suggested Athens may need to resort to capital controls.
Greek Prime Minister Alexis Tsipras said he was more optimistic of drawing up a satistfactory reform list after the summit.
“There was confirmation of the will of all sides to work so as to restore the financing ability of the Greek economy as soon as possible,” said Mr Tsipras.
A four-month continuation of the country's bail-out was agreed in principle last month. But the €7.2bn has yet to be released to the cash-strapped government which is struggling to stay solvent this month. Greece is due to repay its last tranche of IMF loans due for March later today.
The debt-stand-off has seen Greece's 10-year bonds spike above 12pc, the highest level since June 2013.
In a statement released in the early hours of Friday morning, the EU said the Greek government had "ownership" of its reforms and would present them to creditors in the coming days.
"In the spirit of mutual trust, we are all committed to speed up the work and conclude it as fast as possible."
A release of funds could be agreed for as early as April 8 should the anti-austerity government satisfy the Brussels Group with its reforms list by the end of next week.
Speaking ahead of the European Council summit, Ireland's premier Enda Kenny condemned Athens's threats to unleash a wave of jihadists into Europe as "unacceptable."
He said it the anti-austerity government had to "face up to their responsibilities."
"The [Greek] prime minister has asked for time and space and he has been given that to come forward with sustainable and workable proposals," said Mr Kenny.
Athens has been involved in a series of unsavoury episodes with its largest debtor country in recent weeks.
Finance Minister Yanis Varoufakis has been embroiled in a controversy over sticking his middle finger to Berlin, while demands for Second World War reparations have angered Germany.
Writing on his website, the "rock star" academic turned politician dimissed the episode as a "kerfuffle" and urged and end to the "toxic blame game" that has taken hold in the debt negotiations.
"Beyond current tensions, our joint task is to re-design Europe so that Germans and Greeks, along with all Europeans, can re-imagine our monetary union as a realm of shared prosperity," wrote Mr Varoufakis.
“There was confirmation of the will of all sides to work so as to restore the financing ability of the Greek economy as soon as possible,” said Mr Tsipras.
A four-month continuation of the country's bail-out was agreed in principle last month. But the €7.2bn has yet to be released to the cash-strapped government which is struggling to stay solvent this month. Greece is due to repay its last tranche of IMF loans due for March later today.
The debt-stand-off has seen Greece's 10-year bonds spike above 12pc, the highest level since June 2013.
In a statement released in the early hours of Friday morning, the EU said the Greek government had "ownership" of its reforms and would present them to creditors in the coming days.
"In the spirit of mutual trust, we are all committed to speed up the work and conclude it as fast as possible."
A release of funds could be agreed for as early as April 8 should the anti-austerity government satisfy the Brussels Group with its reforms list by the end of next week.
Speaking ahead of the European Council summit, Ireland's premier Enda Kenny condemned Athens's threats to unleash a wave of jihadists into Europe as "unacceptable."
He said it the anti-austerity government had to "face up to their responsibilities."
"The [Greek] prime minister has asked for time and space and he has been given that to come forward with sustainable and workable proposals," said Mr Kenny.
Athens has been involved in a series of unsavoury episodes with its largest debtor country in recent weeks.
Finance Minister Yanis Varoufakis has been embroiled in a controversy over sticking his middle finger to Berlin, while demands for Second World War reparations have angered Germany.
Writing on his website, the "rock star" academic turned politician dimissed the episode as a "kerfuffle" and urged and end to the "toxic blame game" that has taken hold in the debt negotiations.
"Beyond current tensions, our joint task is to re-design Europe so that Germans and Greeks, along with all Europeans, can re-imagine our monetary union as a realm of shared prosperity," wrote Mr Varoufakis.
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