Photographer: Kostas Tsironis/Bloomberg

Greece to Break Off Face-to-Face Talks as Issues Persist

  • Negotiators will continue the deliberations from abroad
  • Greece and its creditors discussing pension cuts, labor reform

Greece and the institutions managing its bailout review will break off negotiations in Brussels without having cleared a path to conclude the deliberations that would release needed rescue funds.

Finance Minister Euclid Tsakalotos, who was meeting with officials from the euro area and the International Monetary Fund, will return to Athens by Saturday, a Greek government officials said in a text message. The two sides still have issues to work out, said the official, who asked not to be named in line with policy. 

Some progress was made and discussions will continue from their respective headquarters, according to a spokesman from the European Stability Mechanism, the euro-area’s bailout monitor.

Greece is edging closer to a repeat of the 2015 drama that pushed Europe’s most indebted state to the edge of economic collapse, as the government in Athens and its creditors disagree over reforms to the pension system and the labor and energy markets. Greece needs to complete the review in order to get the next portion of its aid payment before it has more than 7 billion euros ($7.6 billion) of bonds come due in July.

To read more about Greece’s bailout uncertainty, click here.

German Finance Minister Wolfgang Schaeuble increased the pressure on Prime Minister Alexis Tsipras to accede to creditor demands.

“Greece has said it wants to stay in the euro,” Schaeuble said in an interview on Deutschlandfunk radio on Friday. “Greece can only do that if Greece has a competitive economy. To that end, it needs to carry out reforms, and we’re giving Greece time to do that.”

Even as it faces hurdles on the economic front, Greece signaled that it will join the 26 other European Union nations in presenting a united front at a summit on Saturday in Rome. Tsipras sent European Council President Donald Tusk a letter saying he would sign a declaration at the gathering. Earlier in the week, a Greek official said the government wanted the declaration to include language supporting workers.

European Commission President Jean-Claude Juncker urged Greece and its creditors in an emailed statement to reach a deal that respects commitments made on all sides. In response to Tsipras’s letter, Juncker called on the Greeks not to reverse reforms and creditors “to give Greece the desired and necessary room for maneuver to build its own future.”

— With assistance by Tony Czuczka, Nikos Chrysoloras, and Jonathan Stearns

    Before it's here, it's on the Bloomberg Terminal.
    LEARN MORE