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Greece makes new proposals to end bailout impasse

Published:Wednesday | June 10, 2015 | 12:00 AM


New Greek proposals aimed at ending a long standoff with international bailout creditors and unlocking vital rescue funds were received with little visible enthusiasm in Brussels on Tuesday.

Greece has just three weeks to conclude a deal before its finances implode, and a key negotiator complained that officials at the European Union's executive Commission have yet to respond to the documents presented late Monday.

"We want a written and clear answer," State Minister Nikos Pappas said in a comment posted on a social media site as Prime Minister Alexis Tsipras briefed officials in his Syriza party on the negotiations.

A government official said the proposals included alternative ideas on budget measures required for creditors to approve the bailout payment and for "a workable plan" to render Greece's crushing debt load viable. No further details were made public.

The submission follows last week's impasse when bailout creditors responded to a 47-page Greek proposal with a brief counter-offer that Athens rejected as containing "absurd" measures that would worsen the lot of Greeks already reeling from five years of deep cuts and soaring unemployment.

The two sides mainly disagree on creditors' demands for Athens to raise the sales tax on food, medicine, and power bills; labour market reforms and cuts to pensions. These would be hard for the new government to implement less than five months after its election on a combative anti-austerity platform.

A deal must be struck before the end of June when Greece's bailout programme ends - and the pending €7.2 billion (US$8 billion) payment will no longer be available. Without the cash, Greece will be unable to pay its creditors and would default on its loans.

Greece has already said it will bundle its four June debt repayments all owed to the International Monetary Fund (IMF) and totalling €1.6 billion (US$1.8 billion) into one on June 30. The move, which is allowed under IMF rules, may be more a sign of defiance than absolute penury.

A spokesman for the European Commission - which together with the European Central Bank and the IMF oversees the rescue programme - said "diverse proposals are being circulated" but did not comment on what European officials thought of them.

"The three institutions are currently assessing these suggestions with diligence and care," Margaritis Schinas said in Brussels.

Speculation is now growing that the bailout deal could be extended months past its current end-June expiry.

Schinas said that "if the conditions are there" Tsipras could hold a new meeting today, Wednesday, with European Commission head Jean-Claude Juncker on the sidelines of an EU-Latin America summit in Brussels.

At the summit, Tsipras is also expected to meet again with German Chancellor Angela Merkel and French President FranÁois Hollande.

Greece has depended on international rescue loans since 2010 when it was unable to finance itself by borrowing from financial markets.