Greece's PM Antonis Samaras said the future of his country was in the balance after EU finance chiefs failed to reach a deal that would allow creditors to hand over the next batch of rescue loans to the debt-ridden country.
Greece has reacted with dismay to the European Union’s failure to agree to release vital rescue loan funds for the debt-ridden country, with the prime minister warning it was not just Greece’s future that hangs in the balance.
The delay prolongs uncertainty over the future of Greece, which faces a messy default that would threaten the entire euro currency used by 17 EU nations.
Prime Minister Antonis Samaras stressed that Greece has done what its creditors from the EU and International Monetary Fund required. “Our partners, along with the IMF, also must do what they have committed to doing,” he said.
He said that “it is not just the future of our country, but the stability of the entire eurozone” that depend on the success of negotiations in coming days.
France's Finance Minister Pierre Moscovici offered Samaras some hope, saying ministers were only a 'whisker' away from reaching an agreement.
Jean-Claude Juncker, chairman of the meeting of finance ministers from the 17 countries that use the euro, said the talks, which lasted nearly 12 hours, will reconvene on Monday.
It was the second consecutive meeting at which the ministers failed to agree on a deal, highlighting the depth of their divisions over how to handle Greece’s huge debt problem without reaching more deeply into the pockets of their own taxpayers.
Juncker, however, said he was optimistic that a deal could be reached.
“We are very close to a result. We see no major stumbling block,” he said. "There are technical issues and calculations to be made in coming days".
But Christine Lagarde, the managing director of the International Monetary Fund, which gives Greece bailout loans alongside the eurozone, sounded a more cautious note, saying only “we have narrowed the positions.”
Investors reacted by selling the euro, which dropped from above $1.2810 to $1.2755 within a half hour. Stock markets in Asia surrendered early gains.
There has been disagreement among the ministers and the IMF on how to make Athens’ debt manageable.
The eurozone ministers are in favour of giving Greece an extra two years, to 2022, to bring its debt down to 120 percent of gross domestic product from the 176 percent forecast for this year. The IMF has resisted such an extension.
Agreement on this issue is needed for the group of creditors to pay Greece the next batch of its rescue loans, expected to amount to €44.6 billion ($57 billion).
Greece the needs the money to avoid bankruptcy.
(FRANCE 24 with wires)
Date created : 2012-11-21