BRUSSELS (AFP) – Greece has begun tough negotiations with its creditors as hopes rise that a make-or-break meeting next week could reach a deal on the new government’s demands to overhaul its huge international bailout.
The technical talks in Brussels Friday came a day after Greece’s anti-austerity Prime Minister Alexis Tsipras laid out his plans to sceptical counterparts including German Chancellor Angela Merkel at his first European summit.
World stocks and the euro both rose Friday amid growing optimism that debt-stricken Athens could now thrash out a compromise with finance ministers from the 19-country eurozone at a critical meeting on Monday.
But the clock is ticking as the 240-billion-euro ($270-billion) EU-IMF bailout is due to expire at the end of February, and failure to reach a replacement agreement could trigger a Greek default and a chaotic exit from the euro.
Eurogroup chief Jeroen Dijsselbloem said Friday he was “pessimistic” about any quick deal with Greece, labouring under a mountain of debt equivalent to 175 per cent of its annual economic output.
“The Greeks have sky-high ambitions. The possibilities, given the state of the Greek economy, are limited,” said Dijsselbloem, who is also Dutch finance minister. “I don’t know if we’ll get there by Monday,” he added.
Tsipras and his hard-left Syriza party won elections on January 25 on the back of his promises to replace Greece’s current bailout, and to ditch the hated “troika” of its creditors — the European Union, International Monetary Fund and European Central Bank.