Chancellor Merkel says greek deal still possible

Alexis Tsipras, Greek Prime Minister

Angela Merkel, the German Chancellor, said that a solution was still possible to solve the Greek crisis. She said this as she arrived at a summit meeting Wednesday of EU and Latin American leaders which Greek Prime Minister Tsipras also will attend.

Merkel also said she would be available to talk with Tsipras at the Brussels meeting if she wished. 

Merkel said:"The goal is to keep Greece in the Eurozone. I always approach these things with the attitude, if there is a will there is a way. But the work has to happen with the three institutions (Greece's bailout monitors: the European Commission, European Central Bank and International Monetary Fund). And every day counts....On the fringes there will be maybe a meeting with the Greek prime minister, as well with the French president. We did not yet fix a time, but if the Greek prime minister wants to talk with us, we will of course do that."

The Greek government has been negotiating for five months now on a deal with its creditors, the EU Commission, European Central Bank (ECB) and International Monetary Fund| (IMF). These used to be called the Troika but are no referred to simply as the "institutions". While Greece has given way on many issues with respect to its anti-austerity red lines, it still has refused to move on cuts to pensions and on labour market issues. On some tax issues and on privatization is has already yielded.

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In order to make earlier loan payments to the IMF, the Greek government had to borrow from pension funds and defer payments to schools and hospitals: The result is that the government has managed to scrape together just enough funds to meet IMF and ECB repayments in the last few months, while hospitals have no medicines and equipment, schools have no books and materials, and doctors and teachers leave the country. The situation for businesses is dire.

According to the Greek retailers' association each day about 59 business close down and 613 jobs are lost. Talks a week ago between head of the European Commission, Jean-Claude Juncker did not produce a breakthrough. Greece strenuously rejected creditors' proposed deal. Greece submitted a new list of reform proposals on Tuesday an extension of the program beyond its end of June deadline has also been discussed.

The new Greek proposals were already dismissed as inadequate by the EU by early Wednesday.

The chief European Commission spokesperson, Margaritas Schinas, said of the situation: “For this final push, the Commission is of the view that the ball is clearly on the court of the Greek government. It needs to follow up on the agreement on the meeting with President Juncker last Wednesday night.”

Those talks failed!

Pierre Moscovici, the EU Commissioner for Economic and Financial Affairs told a Greek delegation yesterday that "their latest suggestions do not reflect that state of the discussions between" between Brussels and Athens. Moscovici did say that work was continuing to break the deadlock on economic reforms that creditor's insist that Greece must agree to before unlocking the remainder of the funds in the bailout loan.

The Greek government finds it in an impossible situation as it attempts to be allowed at least a few of its anti-austerity policies as part of the deal in order to placate critics within its own party and retain some credibility with the Greek populace. So far creditors have given the government virtually nothing. The only option now for the Greek government seems to be to cave and spin the result positively or finally decide to default and perhaps leave the Eurozone.

Additional sources:
http://www.cnbc.com/id/102743366
http://news.yahoo.com/greek-debt-crisis-solution-possible-says-merkel-140954683.html
https://www.jacobinmag.com/2015/06/greece-syriza-imf-tsipras-debt-eu