Accessibility links

Eurozone Markets Fall as Hopes Low for Greece Bailout Deal

  • Associated Press

Greek Finance Minister Yanis Varoufakis arrives for a meeting of the eurogroup finance ministers at the EU Council building in Brussels May 11, 2015.

Greek Finance Minister Yanis Varoufakis arrives for a meeting of the eurogroup finance ministers at the EU Council building in Brussels May 11, 2015.

Hopes for a deal between Greece and its European creditors at a key meeting Monday are slim, weighing on the region's stock markets as the country struggles to make upcoming debt repayments.

Ahead of a meeting with his counterparts in the 19-country eurozone, Greek Finance Minister Yanis Varoufakis said Greece and its creditors have a “moral and political responsibility” to swiftly reach a deal. Athens will not, however, budge from its key negotiating positions, he said.

Stock markets fell in the eurozone, led by Athens' index, which dropped 2.8 percent.

Despite three months of talks, Greece and its creditors have failed to agree on further reforms and savings Athens needs to qualify for a 7.2 billion euro ($8 billion) loan installment. Without the cash, Greece could go bankrupt within weeks.

It is expected to be able to make a 770 million euro repayment to the IMF on Tuesday, but only after scraping together enough reserves from local governments and state entities like hospitals.

Without more bailout loans, Greece will have trouble paying pensions and state salaries at the end of the month, as well as more debt obligations in July and August.

In a sign of how the pressure is growing, Varoufakis was scheduled to meet German Finance Minister Wolfgang Schaeuble - one of the toughest negotiators in the talks with Greece - ahead of the wider meeting on Monday.

Varoufakis says Greece's left-led government will reject any deal that doesn't guarantee a credible prospect of ending Greece's economic crisis. The Greek government came to power in January on a pledge to end budget cuts that it blames for focusing too much on reducing debt, at the expense of the economy.

Monday's meeting in Brussels will include representatives from international creditor institutions - the European Commission, the European Central Bank and the International Monetary Fund.

The ministers will take stock of the institutions' assessment of whether Athens has made enough progress on its reform plans to secure the sorely-needed payment.

After a shaky start, talks between Greece and the institutions have improved but no final agreement to secure the bailout money is likely on Monday, and it remains unclear whether one will come before June 30, when Greece's European bailout program expires.

Varoufakis said in a radio interview that Greece has done “everything humanly possible” in offering concessions for a deal.

The common ground is there, a mutually beneficial solution is visible, so long as [Greece's creditors] have the political will to take the necessary steps,” he told pro-government Sto Kokkino radio.

Greece last received a bailout payment in August 2014.

XS
SM
MD
LG