Apr 25, 2015 4:34 AM

Eurozone hopes Greek criticism will bear fruit

The Associated Press

RIGA, Latvia (AP) Greece's European creditors expressed the hope Saturday that the criticism the country's finance minister faced over his failure to present an economic reform plan on time will prompt a positive response soon.

In the Latvian capital of Riga, the eurozone's top official, Jeroen Dijsselbloem, said he hopes "some extra urgency" will be injected into the process following the "critical" meeting of the eurozone's 19 finance ministers the day before. Greece's Yanis Varoufakis was rebuked for failing to come up with a list of economic reforms.

"But it is going to take a couple of days at least," Dijsselbloem said.

Just two months ago, Greece secured an agreement from the eurozone to get the remaining money in its bailout fund 7.2 billion euros ($7.7 billion) but only if it came up with a mutually agreed set of reforms.

But with days to go, Athens has yet to present a full list, prompting Friday's criticism of Varoufakis and the effective abandonment of the deadline. His peers spoke of being "tired" and "annoyed" with the way the talks are going.

On Saturday, as they arrived for talks with their non-euro partners in the 28-country European Union, finance ministers sought to downplay talk of a Greek debt default and the country's exit from the euro.

"Yesterday, we spoke of an A plan, of 'the' plan, because there is no plan B, C, D, or E," said French Finance Minister Michel Sapin. "There is only one plan, and that's Greece in the euro, Greece in Europe."

Though acknowledging the "anxiety" among his peers, Greece's Varoufakis has sought to portray the discussions in a more positive light, noting progress on issues such as privatization, reforming the tax system, the judiciary, the bureaucracy and product markets.

Varoufakis said the main sticking points related to pensions and the level of the budget surplus Athens has to post after debt and interest payments are stripped out a higher level would effectively mean the government has less money to spend on its priorities.

All sides agree that the clock is ticking. The next possible date for a deal could be May 11, when eurozone finance ministers will meet next and just one day before Greece owes a big payment to the IMF.

"We should move faster, because time is running out, financial difficulties are there as well as the commitments made," said Pierre Moscovici, the European Union's top economic official.

Greece has relied on 240 billion euros in bailout loans since May 2010 after it was effectively locked out of international bond markets amid concerns it was insolvent.

In return for the cash, successive governments have had to make savage spending cuts and economic reforms. But while the measures have focused on improving public finances, they have also hurt the economy and caused unemployment to skyrocket.

The current government was elected in January on a promise to end such so-called austerity. Its focus is on fighting corruption, reforming the public sector, and improving the porous tax system.

The prevailing view in markets is that a deal will be reached in time to avoid a Greek debt default, but only when the pressure on the country becomes unbearable for example, when the government is out of money to pay its debts or the banks start seeing deposits running dry due to withdrawals by worried savers.

The decision this week by the Greek government to scrape together spare cash from municipalities and state enterprises like hospitals and the national gallery is likely to buy some time. The move which Greek lawmakers formally approved in a vote late Friday could, according to independent estimates, rake in 2 billion euros ($2.14 billion), which would cover its debt payments in May.


David Keyton in Riga contributed to this report.


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