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 Athens said the deal struck late on Friday in Brussels should calm
Greeks who had feared capital controls might be imposed as a prelude
to leaving the euro. But some weary voters questioned what their new
leaders had achieved in weeks of testy exchanges with euro zone
hardliners led by EU paymaster Germany.
After often ill-tempered negotiations, Greece secured late on Friday
a four-month extension to euro zone funding, which will avert
bankruptcy and a euro exit, provided it comes up with promises of
economic reforms by Monday.
"We won time," said government spokesman Gabriel Sakellaridis. "The
Greek economy and the Greek government weren't strangled, as was
perhaps the original political plan by centers abroad and within the
country," he told Mega TV, without naming the euro zone hawks who
forced the government into a climbdown at the Brussels talks.
Prime Minister Alexis Tsipras has won wide support at home for what
Greeks see as their leaders finally getting tough instead of going
to Brussels cap in hand and taking orders from Berlin. But it was
also under intense pressure at home.
About 1 billion euros flooded out of Greek bank accounts on Friday,
a senior banker told Reuters, due to savers' fears that the talks
would fail and Athens might have to halt such withdrawals or prepare
to reintroduce a national currency.
This added to an estimated 20 billion euros ($23 billion) that
Greeks have withdrawn since December, when it became clear that the
radical Syriza party of Tsipras was likely to win power in last
month's parliamentary elections.
Faced with the risk of a chaotic bank run on Tuesday after a long
holiday weekend, Finance Minister Yanis Varoufakis stressed that the
deal should calm savers.
"It is quite clear that the reason why we had a deposit flight was
because every day, even before we were elected, Greeks were being
told that if we were elected and we stayed in power for more than
just a few days the ATMs will cease functioning," he told reporters
in Brussels on Friday. "Today's decision puts an end to this fear,
to the scaremongering."
Seeking to calm Greeks worried about Monday's public holiday, a
source at the European Central Bank said after the Brussels deal
that capital controls were out of the question.
Last month's election of Syriza on promises to reverse austerity
policies dictated by Greece's EU/IMF bailout program raised huge
expectations among the public.
But under Friday's deal with euro zone finance ministers, Athens
agreed to an extension of the bailout it had promised to scrap, and
accepted oversight by the hated "troika" of officials from the
European Commission, European Central Bank and International
Monetary Fund, albeit under a new name.
"We went through two months of agony, emptied the banks, to realize
we are still a debt colony," 54-year-old electrician Dimitris
Kanakis told Reuters. "The paymasters call the shots."
However, the deal did open the possibility of lowering a target for
Greece's primary budget surplus, which excludes debt repayments,
freeing up funds to ease what Tsipras calls the nation's
"humanitarian crisis".
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Spokesman Sakellaridis acknowledged that the deal, which is
conditional on euro zone ministers accepting Greece's economic
reforms plans on Monday, was only a first step. He also admitted the
difficulty for a government which is less than a month old in
negotiating with heavyweight European ministers.
"These last three weeks were tough weeks for a new government which
-- let's not kid ourselves, we're not trying to fool anyone --
hasn't got the relevant experience," he said.
"The real battle begins now," he added. "It is a battle that will be
extremely critical for the course of the country over the next few
years."
German Finance Minister Wolfgang Schaeuble said Greek politicians
used to being in opposition had to wake up to the demands of office.
"Being in government is a date with reality, and reality is often
not as nice as a dream," the conservative veteran said, stressing
Athens would get no aid payments until its bailout program was
properly completed. "The Greeks certainly will have a difficult time
to explain the deal to their voters."
Athens must now negotiate a long-term deal with the euro zone before
the extension runs out in the early summer.
European Union officials said one reason Greece had to cut a deal
now and not delay was that confidential calculations showed the
banking system had risked running out of money when it reopens on
Tuesday. Extra emergency funding authorized by the ECB on Wednesday
would not have been compensated for this.
Tsipras had called for a emergency summit of EU leaders on Sunday if
the finance ministers had failed to agree. However, this idea was
rejected by European Council President Donald Tusk, increasing
pressure for a deal before the banks reopened.
Sources close to the talks said Greece's creditors had lost
confidence in Varoufakis and preferred to deal directly with
Tsipras. Merkel, who had her first long conversation with Tsipras by
phone on Thursday, had been instrumental in ensuring a deal was
done, overcoming some resistance from Schaeuble who had taken a hard
line from the outset.
($1 = 0.8789 euros)
(Additional reporting by Karolina Tagaris, Renee Maltezou and Jan
Stupczewski; Writing by David Stamp; Editing by Ruth Pitchford)
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