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Any Greece deal must match party manifesto, minister says

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Any deal Greece signs with its creditors to avoid default must be in line with the pledges the ruling party was elected on in January, the deputy labour minister said ahead of an emergency summit of European ministers on Monday.

[ATHENS] Any deal Greece signs with its creditors to avoid default must be in line with the pledges the ruling party was elected on in January, the deputy labour minister said ahead of an emergency summit of European ministers on Monday.

After months of wrangling that have left Greece on the verge of bankruptcy, its leftist government submitted last-ditch proposals for a cash-for-reforms deal over the weekend that were welcomed by EU officials as a good starting point for talks. The exact contents of the proposal were not divulged.

But the comments by Deputy Labour Minister Dimitris Stratoulis underscore the tightrope Prime Minister Alexis Tsipras must walk to reach an agreement that will win over both the creditors and his own Syriza party.

Syriza stormed to power in January pledging to roll back years of austerity. A new street protest against the cuts is planned for Tuesday night.

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Greece must repay a 1.6 billion euro loan to the International Monetary Fund next week and any failure to pay could threaten its future in the euro zone currency bloc. The country could also be forced to impose capital controls within days to stem the outflow of billions of euros from Greek banks. "I repeat: The deal will either be compatible with the basic lines of Syriza's election manifesto, or there will be no deal," Mr Stratoulis told Antenna television on a morning news show. "The prime minister is negotiating with this in mind." Greece will refuse to cut pensions and wages, and rejects lenders' demands to curb early retirement benefits immediately, he said, adding that such benefits could be cut at a later date.

Markets rose on Monday, buoyed by the positive reception to the latest Greek proposal. Adding to the mood music, EU Economic Commissioner Pierre Moscovici said he was "convinced" that euro zone leaders at the an emergency meeting in Brussels would find a resolution to the Greek crisis.

Mr Stratoulis repeated a government message that austerity had made Greece's plight worse, and that its creditors would suffer more than Greece itself if the country were pitched out of the euro zone. "So far the lenders have not backed down mainly because if they had backed down or do back down, they would accept that the bailout policies destroyed Greece and its people," he said. "We are not afraid of blackmail, and our priority is the public interest," he said. "Let's see if there will be a deal tonight."

REUTERS

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