Crunch time for Greece

Athens is not only confident of reaching a deal with its international creditors this week, they are also willing to ease down on its anti-austerity programme

Photo by: Reuters
Photo by: Reuters

Updated Jul 28, 2015

Greek officials are pushing on talks with its international lenders over the weekend as both parties are determined to work towards a deal in order to avoid a default and possible “Grexit.” 

“The key issue is to resolve the situation so that Greece can remain a member of the euro area,” the European Commission’s vice president, Jyrki Katainen, told Finland’s YLE TV1. “Unfortunately over the past six months things have turned for the worse in Greece, purely for political reasons.”

The cash strapped country has been locked in talks for months on a cash-for-reforms deal with its foreign lenders - the International Monetary Fund (IMF), the European Central Bank (ECB) and the European Commission (EC). The dragging progress has pushed Greece into a liquidity squeeze, tipping the economy into a double-dip recession.

If a deal is not settled soon, Greece risks default without aid from a bailout program that expires on June 30.

“We are in the home stretch, close to the final agreement."  said Greek Prime Minister Alexis Tsipras who is hoping for a deal on Sunday. Thus, international creditors were not convinced as they believe Tsipras is still reluctant to mending the country’s “red lines.”

However, Interior Minister Nikos Voutsis, who does not take part in Greece's talks with its lenders, attempted to weigh down the creditor's pre-judgements. 

"Some parts of our program could be pushed back by six months or maybe by a year, so that there is some balance," said Voutsis to Skai television. Nevertheless, he did not disclose which parts of the ruling Syriza party's anti-austerity program could be pushed back.

According to Voutsis the debt burdened country has already made some progress on achieving low primary budget surpluses in the first two years. But issues such as sales tax is yet to be resolved. 

TRTWorld and agencies