Greek Premier Alexis Tsipras was
expected to ask for a bridge loan in his country's debt crisis
at the European Parliament Wednesday, as eurozone leaders met in
emergency session Tuesday night following the Greek No to
creditors' terms in Sunday's referendum.
German Chancellor Angela Merkel dashed hopes of a quick
deal, saying that "the basis is still missing" for more
negotiations on Greece and its finances.
French Premier Manuel Valls said a restructuring of Greek
debt was "not taboo" but German Finance Minister Wolfgang
Schaeuble said it was against the founding treaty of the
eurozone.
After a special Eurogroup meeting ahead of the summit -
where ministers were said to have been "irritated" by the lack
of a written Greek proposal - its head Jeroen Dijsselbloem said
that Greece was poised to request aid on Wednesday from the
European Stability Mechanism (ESM).
But the Eurogroup also wants written proposals "very
quickly" from Greece, he added.
Finance ministers plan to discuss the request and proposals
in a conference call Wednesday, he added.
"It's too soon to be optimistic, Greece needs credible
reforms and that's what we want to hear from them," cautioned
Dijsselbloem.
The ESM was set up in 2012 to provide fast relief for
eurozone member States in financial trouble.
European Parliament Speaker Martin Schulz said Tsipras
would address a plenary EP session Wednesday - where sources
said he would unveil proposals.
Earlier, before Tsipras spoke to Merkel in three-way talks
with French President Francois Hollande, sources said Tsipras
would ask for a seven-billion euro bridge loan to meet emergency
needs and debt repayments in order to avoid default.
An Italian member of the European Parliament told ANSA
Tuesday that EC President Jean-Claude Juncker was developing
such a bridge loan.
"The immediate goal is to save Greece from
bankruptcy...every minute is precious," said Gianni Pittella,
who heads the EU parliament's Progressive Alliance of Socialists
and Democrats group.
"Athens immediately needs help".
Amid the political turmoil, financial market authorities
announced that the Athens Stock Exchange will be closed through
Wednesday.
Juncker said Tuesday that he will work to avoid a Greek
exit from the eurozone as long as it is possible.
"I want to avoid Grexit, I'm against it. I'll try to avoid
it right until the end," Juncker said.
"There are those who are betting on a Greek exit," he
added.
"There are no easy answers in Europe. The Commission will
work to resume negotiations".
Juncker said "the Greek government must tell us how it
wants to get out of this situation".
He added that "concrete proposals" were needed from Athens
and played down hopes of agreement being reached either at the
Eurogroup meeting or at the emergency summit of eurozone
government leaders.
"You cannot resolve the situation in one night," Juncker
said.
Meanwhile Tsipras also conferred by phone with US President
Barack Obama who voiced the hope that the outcome of talks would
be positive and a Grexit would be averted.
Obama later phoned Merkel and conveyed an appeal for Athens
to stay in the eurozone.
The International Monetary Fund, for its part, warned that
the Greek crisis could have a major impact on Italy, although
the risk of full-blown contagion is limited.
"Adverse developments in Greece could have a substantial
impact on Italy via the effects on confidence, although direct
exposure is limited," read the IMF's Article IV on Italy.
"The risks of contagion in the short term are limited
too".
Premier Matteo Renzi's government has repeatedly said
Italy is not in peril even in the case of a Greek default and
exit from the eurozone, as Rome has adopted reforms and has the
shelter of the ECB's bond-buying programme.
The IMF also said that the Italian economy is gradually
emerging from years of recession, but the recovery is fragile.
The fund forecast that the Italian economy will growth
0.7% this year and 1.2% in 2016.
On a more positive note, the IMF praised Premier Matteo
Renzi for launching "an ambitious agenda to revise the Italian
economic and political system".
It added: "now there is a window of opportunity to take
with deeper reforms to boost growth".
It specifically encouraged measures to improve
public-sector efficiency.
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