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Merkel rules out Greece breakthrough at EU summit

19 March 2015, 17:44 CET
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Merkel rules out Greece breakthrough at EU summit

Angela Merkel - Photo EU Council © European Union

(BRUSSELS) - German Chancellor Angela Merkel squashed hopes of a breakthrough on Greece's debt troubles at a European summit in Brussels Thursday despite pleas from Athens for bold action to end the crisis.

As fears mounted of an exit from the euro, Greek Prime Minister Alexis Tsipras was due to hold a special meeting on the sidelines of the summit with Merkel, French President Francois Hollande and top EU officials.

But European leaders made it clear that Greece's new radical left-wing government, which has alarmed Brussels with its vows to ditch austerity, must live up to its reform promises before it gets vital bailout cash.

"I would like to say, do not expect any solution, do not expect a breakthrough," Merkel, the powerful leader of Europe's biggest economy, told reporters as she arrived at the summit. "That is not the format for today."

Tsipras faces a looming cash crunch at home and wants Brussels to release the final seven billion euro tranche of Greece's 240-billion-euro ($255-billion) EU-IMF bailout so Athens can pay its bills.

"The EU needs bold political initiatives that respect both democracy and the treaties, so as to leave behind crisis and to move towards growth," Tsipras told reporters.

But first, Brussels insists that Tsipras live up to the reforms his government promised when it won a four-month extension to the debt bailout at fraught talks in February.

- 'Too hot' -

Hollande urged the Greek government to "show they will carry out reforms."

"There is nothing wrong with the Greek government making efforts for the poor but what we are asking of Greece is that it makes the rich pay their taxes," he said.

The crisis has become increasingly bad tempered, with Tsipras hitting out Wednesday at EU "technocrats" as the Greek parliament adopted a "humanitarian crisis" bill aimed at helping the poor.

EU President Donald Tusk said he had agreed to Tsipras's request for the special meeting because he feared a discussion in the full 28-nation summit "could be a little bit too hot".

Tusk said it would not be a "decisive" meeting and the former Polish premier also insisted that there was no question of Greece crashing out of the 19-country eurozone.

"Nobody wants a so-called Grexit. Everybody wants to avoid this risk of so-called Grexident," he said.

The separate Greece meeting will also be attended by European Commission head Jean-Claude Juncker, European Central Bank chief Mario Draghi and Jeroen Dijsselbloem, the Dutch finance minister who chairs the euro single currency group.

European Parliament President Martin Schulz said that the situation in Greece was "dangerous" and that Athens needed "two or three billion" euros in the short term to meet its bills.

Friday brings a key debt deadline when Greece must pay 300 million euros to the IMF and redeem 1.6 billion euros in treasury bills.

- Russia sanctions -

The EU leaders will also debate whether to roll over economic sanctions against Russia over the Ukraine conflict from their expiry date in July until December.

Merkel said the sanctions should be tied to the timeline of February's Minsk II accord, which is the basis of a shaky ceasefire in eastern Ukraine between Kiev and pro-Kremlin rebels.

"We will discuss that the Minsk accord must be fully respected and that the duration of sanctions depends on the implementation of this accord," said Merkel, who travelled to Minsk with Hollande to seal the deal last month.

The sanctions were imposed after the shooting down of Malaysia Airlines flight MH17 last July, the bloodiest single incident of a conflict that has claimed more than 6,000 lives.

In Brussels, Ukrainian Prime Minister Arseniy Yatsenyuk warned EU leaders Thursday to keep the pressure on Russia, saying it would be a "disaster" if they allowed President Vladimir Putin to "split the unity" over sanctions.

The summit comes just after Russian celebrations over the first anniversary of the annexation of Crimea.

Diplomatic sources said the most likely outcome is that EU leaders ask the European Commission, the EU's executive arm, to begin work so the sanctions can be rolled over in June.

"New sanctions won't happen," one diplomat said.

The EU leaders are also expected to back the creation of a special media team aimed at countering Russian "disinformation".

European Council, 19-20/03/2015


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