Greece presents deal for a ‘definitive solution’
June 22, 2015, 5:06 am

Greek PM Alexis Tsipras, center, arrives in Brussels Monday with a new proposal that his government says will provide a “definitive solution” [Xinhua]

“The prime minister presented the [European Commission, French and German] leaders Greece’s proposal for a mutually beneficial agreement that will give a definitive solution and not a postponement of addressing the problem,” a statement from Tsipras’s office said.

Tsipras is due to arrive in Brussels with the new proposal on Monday.

The prime minister’s office provided no details on the contents of the proposal, but the wording – “not a postponement of addressing the problem” – appears to indicate that Tsipras may have backed down from a key demand.

The Greek government had previously promised to aggressively restructure its ECB and IMF bailout debt; it had previously indicated that it wanted a delay in repayment schedules until it had renegotiated the restructure.

But Greek Central Bank reports last week that upward of $5 billion were withdrawn from national banks between June 15 and June 20 could have raised fears that the country was approaching a banking crisis.

Greek Finance Minister Yanis Varoufakis told reporters after the emergency meetings that Greece and its creditors were “heading toward a deal”.

European creditors who had plugged billions into Greek coffers since its financial crisis in 2010 say they want Athens to reform its pension program and to raise taxes.

For the past five months, Tsipras’s government had refused outright to increase austerity measures and had instead said it would bring back full pensions for its population.

The timing now is critical: Greece is supposed to repay more than $1.7 billion of its debt to the International Monetary Fund by June 30. Failing to do so would put it in default and, technically, it stands the chance of no longer receiving any European funds.

Athens say it needs nearly $8 billion dollars to keep the economy functioning and repay its IMF debt. On Friday, the ECB said it would make $2 billion available should Greece require such financial assistance.

But Lode Vanoost, a former deputy speaker of the Belgian Parliament, says the issue at the heart of the crisis is not merely about fiscal assistance but rather the politics of anti-austerity, which brought to power the Syriza-led government in Greece.

“For Brussels, it is out of the question that any EU country could come up with solutions to the crisis that would go against prevalent orthodoxy,” he writes.

On Sunday, local polls indicated that 62 per cent of Greeks did not want the government to make any further concessions to European creditors.

This came as hundreds of anti-austerity protesters returned to the streets of Athens over the weekend.

The BRICS Post with inputs from Agencies