Final talks between Greek negotiators and representatives of the country’s creditors collapsed in Brussels on Sunday evening as Germany’s vice chancellor, Sigmar Gabriel, warned that Europe would not be blackmailed.
A spokesman for the European Commission, which hosted the lower-level talks, said a “significant gap” remained between the two sides and there was no longer time to reach a “positive assessment” before eurozone finance ministers meet on Thursday.
The International Monetary Fund, which jointly administers Greece’s €240 billion bailout with the European Union, pulled out its negotiators before the weekend, citing “major differences” with the Greek side.
European Council president Donald Tusk urged Greece to stop stalling. “There’s no more space for gambling, there’s no more time for gambling,” he said.
Greece is due to repay a €1.5 billion loan from the IMF before the end of the month. Another €3.5 billion in bond redemptions is due in the middle of July.
Officials worry that if a deal isn’t struck this week, there will not be enough time left for European parliaments to enact the legislation needed to give Greece more financial support.
In a sign of just how much the Greeks have exasperated their European partners, Gabriel, Germany’s economy minister and head of the ruling Social Democrats — a group has otherwise been more sympathetic to the left-wing government in Athens — told the Bild tabloid the rest of the continent was running out of patience. He urged the Greeks not to gamble on a European desire to keep them in the euro and issued a stark warning: “We will not let the exaggerated electoral pledges of a partly-communist government be paid for by German workers and their families.”
The far-left Syriza party that came to power in January reneged on the commitments Greece had made since 2010 to qualify for financial aid. The creditors want Greece to resume economic and welfare reforms; the new government demands debt relief and plans to raise the minimum wage, restore collective bargaining and cancel pension cutbacks and privatizations.
The Greeks have not helped their case by demanding war reparations from Germany as well and threatening to flood Europe with immigrants — including militants who might have been fighting for the Islamic State in Iraq and Syria — or seek help from Russia instead.
The Financial Times reports that Greece’s latest counterproposal included no cuts in public sector pensions or increases in taxes on electricity — positions that have been rebuffed by creditors for weeks.
“Greek movement [is] not discernible,” a senior eurozone official told the British newspaper. “I think they do not want a solution.”