Greece has only days to apply for emergency funding, say creditors

Greece has a "matter of days" to submit fresh reform proposals to release emergency funding, Greece's creditors warned on Tuesday, after another crisis meeting in Brussels passed without opening fresh bailout talks.

As authorities in Athens reportedly worked on an application to the ESM bailout fund for submission on Wednesday, the new Greek finance minister, Euclid Tsakalotos, arrived empty-handed at his first meeting with EU colleagues in Brussels.

The emergency meeting – convened to deal with the fallout from Sunday’s referendum – fell far short of expectations with the Greek minister making an oral presentation. His finance minister colleagues complained his proposals contained nothing they had not heard in the last proposal from Athens to its creditors on June 30th.

Euro zone finance ministers are expected to hold a conference call at some time on Wednesday to discuss the latest Greek proposals, whenever they land. Speaking after on Tuesday’s inconclusive meeting, eurogroup head Jeroen Dijsselbloem said he was hopeful a new request for ESM support – followed by a finance minister conference call – could “formally start the process” of processing a third bailout deal.

Stark assessment

But he repeated the by now familiar warning that the window to act was closing. “All this has to be done in a matter of days,” said Mr Dijsselbloem. “We have very little time, as you are all aware.”

German chancellor Angela Merkel agreed with his stark assessment, saying Athens had "not weeks but a few days" to get creditor backing – and fresh funding – for its new reform proposals.

With nothing on the table in Brussels to discuss, Dr Merkel said this meant there was “still no basis to commence talks”. After the expiry of the second programme and the “more than clear” vote of the Greek people on Sunday, the German leader stepped up her rhetoric to warned that it would “not be possible” to “continue down the road together” unless EU solidarity yielded fresh Greek reform commitments.

“For us it remains the case that solidarity on European level and responsibility at national level – the quid pro quo – belong together,” she said.

Even French president François Hollande, in recent days a conciliatory voice in the standoff with Greek leader Alexis Tsipras, turned up the pressure on Athens.

Arriving in Brussels for a meeting with no concrete proposals to discuss, Mr Hollande cautioned the Greek government that credible proposals were an essential precursor for urgently needed aid.

“Greece must make serious, credible proposals, we are waiting for them and they have already been announced. They must be fleshed out now,” he said. Heading into a room of impatient EU leaders, however, he reminded them of their responsibility to “show solidarity by giving [Greece] a medium-term outlook”.

In tune with EU leaders, the European commissioner with responsibility for the euro, Valdis Dombrovskis, refused to rule out a Greek exit from the euro unless progress was made in the coming days.

When asked if the EU wanted Greece to leave the single currency zone, he said: “It is not our aim but if trust is not rebuilt; if [there is] no credible reform package [then] it cannot be excluded.”

Before leaders arrived, finance ministers at an emergency eurogroup meeting vowed to work constructively on any new proposals from Athens.

Tempers strained

But, with time short and tempers strained, Finnish finance minister Alex Stubb spoke for many when he warned that keeping Greece within the euro could not come at the price of softening the terms of any deal.

“We respect the result of the referendum, the door for negotiations remains open but at the same time conditionality is not going to be softened,” said Mr Stubb.

With total Finnish exposure to Greece of €5 billion – or 10 per cent of its annual budget – Mr Stubb said his government “required” conditionality to back any new bailout. Finland is one of up to six euro zone members that may need parliamentary approval for a further loan package for Greece; its centre-right coalition includes the populist, bailout-critical Finns party.

Equally outspoken at Tuesday’s eurogroup were the Baltic finance ministers. Latvian minister Janis Reisrs said the Syriza government had, “to date done nothing else except run the economy into the ground”.