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Greece debt crisis: PM Tsipras to present new plan to eurozone

Greek Prime Minister Alexis Tsipras is expected to present new proposals at a eurozone emergency summit on his country’s growing debt crisis.

The plan is said to include a demand for Greece’s debt to be cut by up to 30%, after voters rejected the terms of an international bailout on Sunday.

Athens has been urged to make “serious” proposals as Greece risks defaulting on its €323bn ($356bn; £228bn) debt.

Greece’s banks are to stay closed on Tuesday and Wednesday.

The European Central Bank (ECB) is maintaining its pressure on Greek banks, refusing to increase emergency lending and ordering them to provide more security for existing emergency loans.

Eurozone finance ministers will meet in Brussels later on Tuesday before a full summit of eurozone leaders.

Mr Tsipras may be prepared to accept many of the demands made by Greece’s creditors, the BBC’s Chris Morris in Athens reports.

But – emboldened by his resounding win in the referendum – Mr Tsipras also wants the more gradual implementation of some reforms and substantial debt relief, reports say.

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Following a meeting on Monday, the leaders of all Greek parties except the communists and far-right Golden Dawn party released a joint statement insisting that the country should stay in the eurozone.

“The recent verdict of the Greek people is not a mandate for rupture, but a mandate to continue and strengthen the effort to reach a socially fair and economically viable deal,” the statement said.

Central to any negotiations will be new Greek Finance Minister Euclid Tsakalotos, who replaced outspoken Yanis Varoufakis on Monday.

Mr Tsakalotos has admitted he is nervous and worried about the crisis, but said Greece deserved a better deal.

French Prime Minister Manuel Valls says the eurozone could not “take the risk of Greece leaving”. He told French radio: “The basis for a deal exists.”

However, Germany earlier warned against any unconditional write-off of Greece’s debt, saying it would destroy the single currency.

“I really hope that the Greek government – if it wants to enter negotiations again – will accept that the other 18 member states of the euro can’t just go along with an unconditional haircut [debt write-off],” said German Economy Minister Sigmar Gabriel.

Speaking at the European parliament in Strasbourg, European Commission President Jean-Claude Juncker said the “ball lies in the court of the Greek government and it must explain in Brussels today how it sees ourselves extricating ourselves from the current situation”.

What are the scenarios for Greece?

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What happens next?

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Meanwhile, the ECB said it would keep emergency cash support for Greek banks, which are running out of funds and on the verge of collapse, at the same level – refusing requests for additional support.

It told the banks to lodge more collateral – or assets – with the Bank of Greece, reducing the amount of spare cash the banks have.

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Greece’s Economy Minister, Giorgios Stathakis, had earlier told the BBC that the ECB had to keep Greek banks alive for seven to 10 days so that negotiations could take place.

Last week, Greece ordered banks to close after the ECB froze its financial lifeline following the breakdown of bailout talks in Brussels.

Capital controls have been imposed, with people unable to withdraw more than €60 a day from cash points.

Source: https://www.bbc.com

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