José Manuel Barroso, the former head of the European Commission, says policymakers are in danger of letting Greece slip out of the euro as ministers signal Athens is ready to compromise
European policymakers must stop “waiting for an accident” to happen in Greece and work towards a deal with Athens to avoid the country’s exit from the eurozone, the former head of the European Commission has warned.
José Manuel Barroso, who led the EC for a decade, said that politicians had taken “too long” to find a solution, which had left Greece in danger of defaulting on its debt.
“Sometimes I get the impression that people are waiting for an accident so that they can really focus [on] avoiding a bigger disaster. It’s too long this time that has been taken to find a solution. I believe it’s important now to find that solution.”
Mr Barroso has previously warned that a Greek exit could trigger the start of disintegration of the euro. “It breaks a taboo and sets a precedent,” he said in April.
Mr Barroso said: “It will certainly be negative for Greece and the euro area if there is a default or if there is a Grexit. But I believe that a solution can still be found.”
Greece will remain in focus this week as the cash-strapped government scrambles to pay back €304m (£218m) due to the International Monetary Fund (IMF) on June 5.
Alexis Tsipras, Greece’s prime minister is due to hold talks with German Chancellor Angela Merkel and Francois Hollande, the French president on Sunday night as part of ongoing efforts to secure Greece’s future in the 19 nation bloc, according to the ANA news agency.
Giorgos Stathakis, minister of economy, infrastructure, shipping and tourism, said on Sunday that he expected a “technical solution” to be found with Greece’s creditors “in a few days.” Mr Stathakis has said the country will avoid a default this week, insisting that the cash-strapped government would meet its June 5 repayment.
Yanis Varoufakis, Greece’s finance minister, said restructuring the country’s massive debt pile would help the country to escape the “vortex” of a self-reinforcing crisis of debt and recession.
Yanis Varoufakis, Greece’s finance minister, is seeking a fresh 30-year loan from the eurozone’s rescue fund to replace debt held by the ECB. He toldGreek newspaper Avghi that the government was lobbying for a low interest loan from the European Stability Mechanism (ESM) with similar terms to its existing €133bn loan.
He said the government wanted a “combination of debt restructuring, investment injections and reforms that go beyond the inhumane practice of cutting pensions, benefits and wages”.
Mr Varoufakis also dismissed rumours that he would resign from the Greek government.
Greece’s ruling party Syriza is waiting for a further €7.2bn in rescue funds that are needed to keep the country afloat.
Ministers have suggested that Greece is ready to make compromises to secure the badly needed cash. “We believe that we can and we must have a solution and a deal within the week,” said Nikos Voutsis, Greece’s interior minister.
Mr Voutsis, who said just a week ago that Greece would not be able toscrape together the €1.6bn due to the IMF this month, told Skai TV: “Some parts of out program could be pushed back by six months or maybe by a year, so that there is some balance.”
The European Central Bank (ECB) will also convene for its regular interest rate meeting this week, where analysts will be listening out for what president Mario Draghi about the situation in Greece.