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Greek PM Says the Ball Is Now in Europe's Court as Time Runs Out to Avoid Default

If Greece and its international creditors cannot reach an agreement by Friday the country could default on its debt and be forced to leave the Euro currency bloc, throwing Europe into crisis.

by VICE News
Jun 2 2015, 12:30pm

Photo by Pantelis Saitas/AP

Greece has submitted what it says is a "realistic proposal" for an agreement with its international creditors, as time runs out for the country to avoid default on Friday.

Greek Prime Minister Alexis Tspiras said on Tuesday it was now up to Europe to prevent the potential breakup of the continent. He gave no indication as to what the deal might include, other than to say it included "concessions that will be difficult."

His comments came the morning after the leaders of Germany, France, the International Monetary Fund (IMF), European Central Bank, and European Commission held an emergency meeting about Greece in Berlin on Monday.

"It is now clear that the decision for whether they want to adapt to realism and emerge from the crisis without the division of Europe, the decision belongs to the political leadership of Europe," said Tsipras.

A payment of 1.6 billion euros ($1.8 bn) from Greece to the IMF is due in June, which the government has said it cannot make good on unless it reaches a deal with creditors. The first installment of 303 million euros is scheduled for Friday. Last month the country was only able to make a 774 million euro payment to the IMF by emptying out an emergency holding account, reported Reuters.

Related: Athens Wants Germany to Cough Up $300 Billion — as Repayment for the Nazi Occupation of Greece

If Greece fails to make Friday's payment it could default on its debt and potentially be forced to leave Europe's single currency bloc.

It has been suggested that Greece might bundle all the money it owes to the IMF together into one single payment on June 30, an option that is allowed but rarely used.

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According to a German government statement, the European leaders at Monday night's meeting pledged to work "with great intensity" to seek a solution.

Germany's Vice-Chancellor Sigmar Gabriel said Greece's exit from the eurozone would have "gigantic consequences," reported the BBC.

"The political consequences of a Greek bankruptcy in the eurozone would of course be gigantic. I think a lot of people have the impression that we're better off without Greece in the eurozone," he said. "The truth is that if we break the first piece out of the European house, Europe would be in a different state."

Greece has been in deadlock with its international creditors for four months, failing to reach an agreement on what reforms it must make in order to release the final 7.2 billion of its 240 billion euro bailout funds. The Eurozone governments and the IMF are its biggest creditors.

The bailout money, granted on the condition that Greece enacted far-reaching austerity measures, has kept the country from default for five years. In the meantime its economy has shrunk by 25 percent, poverty has soared, and a quarter of its workforce is unemployed, reported Reuters in May.

Tspiras' far left Syriza party was elected on an anti-austerity mandate in January and has been refusing to budge on creditors' demands that it further cut pensions, ease the layoffs of private sector workers, and keep the minimum wage the same rather than raise it.

The Associated Press contributed to this report.

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