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Greek PM seeks EU help to break creditor deadlock

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Greek Prime Minister Alexis Tsipras on Wednesday sought help from the European Union to break a deadlock in critical debt talks as his spokeswoman accused the IMF of "undermining" the process.

[ATHENS] Greek Prime Minister Alexis Tsipras on Wednesday sought help from the European Union to break a deadlock in critical debt talks as his spokeswoman accused the IMF of "undermining" the process.

Mr Tsipras' office said the leftist premier had asked EU President Donald Tusk to call a summit to help facilitate negotiations with the debt-ridden country's creditors.

The move came after an expected Eurogroup meeting on Thursday was postponed, scuppering Greek hopes of an agreement by Sunday to launch talks on debt relief.

Mr Tusk said he had urged eurozone finance ministers to meet "within days", warning that failure to act could bring a repeat of last summer's drama that nearly saw Greece crash out of the eurozone.

"We have to avoid a situation of renewed uncertainty for Greece," Mr Tusk said.

Mr Tsipras and Mr Tusk would speak again on Thursday, a Greek government source said.

Eurogroup chief Jeroen Dijsselbloem for his part on Wednesday said the next meeting of eurozone finance ministers could take place "next week or ultimately the week after".

"I know that there is a sense of urgency we all share," Mr Dijsselbloem, also the Dutch finance minister, said at a press conference in Paris.

"We need more time to work with the institutions and the Greek government" on legal and political issues as well as the question of debt relief, he added.

Greece is seeking to unlock promised cash from its massive 86-billion-euro (S$131.4 billion) rescue package - its third since 2010 - that was agreed last year after months of tortuous talks with the European Union, European Central Bank, the European rescue mechanism and the IMF.

Greek government spokeswoman Olga Gerovassili said the International Monetary Fund was "undermining" the latest negotiations with demands that went beyond the bailout deal.

In particular, Greece believes the IMF is behind additional "contingency measures" which the eurozone last week demanded to conclude the current round of talks.

Greece has already pledged to save 5.4 billion euros by 2018 to meet bailout targets, but the new measures - which the creditors want to be approved by parliament now and applied later if necessary - could amount to another 3.6 billion euros according to reports.

Ms Gerovassili said the new demands went "beyond the limits of the Greek constitution and the European legal system".

According to the Greek government source, European Commission chairman Jean-Claude Juncker has also called the IMF demands "unreasonable".

The latest creditor review, which is needed to release the next tranche of bailout loans for Greece, has been chiefly delayed by disagreements over pension cuts and non-performing bank loans.

Eurozone governments have also promised to discuss easing Greece's debt, one of the only concessions granted to Tsipras when he secured the bailout last July.

The Greek government faces big repayments to the European Central Bank this July, amounting to about 2.3 billion euros ($2.6 billion).

But Ms Gerovassili on Wednesday said there was "no insecurity" regarding Greece's cash reserves.

A source with knowledge of the issue told AFP that Greece - labouring under a 311-billion euro-debt mountain - could handle payments without major difficulty until the end of May.

The government in recent weeks has gathered some 500 million euros from the cash reserves of state-run entities, including parliament and social security funds, the source added.

Greece's debt stood at 177 per cent of gross domestic product (GDP) in 2015 - almost twice Greece's entire economic output in one year.

AFP