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 In a defiant speech aimed at winning parliament's backing for his
rejection of the austerity-for-aid package, Tsipras balanced
indignation with confidence that a deal was "closer than ever
before" to keep his country inside the currency bloc.
The contradictory message underscored the growing pressure on
Tsipras to quickly sign a deal before cash-strapped Athens runs out
of money, while also trying to placate hardliners in his leftist
party who oppose the terms creditors are demanding.
One far-left deputy minister suggested snap elections as a way out,
by obtaining public legitimacy for difficult decisions to secure
aid. But Tsipras made no mention of elections in an address that
focused on attacking the aid plan offered by euro zone and IMF
creditors.
"The Greek government cannot consent to absurd proposals," Tsipras
told parliament. "I want to believe that this proposal was a bad
moment for Europe or at the very least a bad negotiating trick and
will soon be withdrawn by the masterminds themselves," he said.
He was speaking after Athens delayed a 300 million euro payment due
to the IMF on Friday, a highly unusual step that rattled financial
markets and sent Greek stocks <.ATF> down 5 percent but that does
not yet signal a formal default.
Opinion polls published on Friday show around three out of four
Greeks want to remain in the euro zone, while more want their
government to accept the offer from European and IMF creditors than
want it to be rejected.
But the lenders' proposal crosses many of Tsipras's 'red lines,'
including hiking taxes, privatizing strategic assets and cutting
benefits for poor pensioners.
Tsipras instead called on lenders to accept Greece's proposal sent
this week that would reverse labor and pension reforms, calling it
the only "realistic" proposal on the table.
He also refused to sign a bailout agreement or deal that does not
include the debt relief he has long demanded.
Greece must agree a deal before its bailout expires at the end of
June or risk outright default, pushing the euro zone into uncharted
waters and opening the way for Greece to exit the European single
currency zone. But the radical Tsipras, elected on a pledge to end
austerity, has remained defiant.
Tsipras said he was shocked that after five year of austerity the
lenders would make demands like abolishing a small benefit for
low-income pensioners and imposing a 10 percentage point jump in
electricity taxes.
His government says overly harsh austerity policies imposed by
lenders in bailout packages have deepened one of the worst
depressions in modern times.
In what appeared to be a threat that Greece was prepared to move
unilaterally if its demands were not met, Tsipras said the
government would legislate the restoration of collective bargaining
rights for Greek workers, a move lenders oppose.
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NEGOTIATING TACTIC
On Friday the government decided to bundle together some 1.6 billion
euros it is scheduled to pay the IMF in June into a single payment
at the end of the month, skipping a 300 million euro payment due on
Friday.
It was the first time in five years of crisis that Greece has
postponed a repayment on its 240 billion euro bailouts from euro
zone governments, the European Central Bank and the IMF.
The IMF said the maneuver was unorthodox but permissible.
Deputy Social Security Minister Dimitris Stratoulis, from the far
left of the ruling Syriza party, made clear the decision was a
negotiating tactic.
"The government's move is a message that it wants to wait and see
how far they (lenders) will take it, if they will back off from this
unreasonable, inhumane, colonialist package they are proposing," he
said.
Yields on Greek two-year bonds soared nearly three percentage points
to over 25 percent, and lower-rated euro zone bonds also headed
higher in a sign of growing market unease.
Many analysts expect a last-minute aid deal that would avert a Greek
exit from the euro but say the coming weeks could see further
ructions in Greek politics, keeping markets on edge.
"Fasten your seat belts for what could be a rough ride in Greece,"
said Berenberg Bank chief economist Holger Schmieding.
Time is running out to clinch a deal and get further disbursements
approved by EU national parliaments, some of which have appeared
reluctant to offer Greece much budget slack, before the bailout
program expires.
Europe's big powers and the United States have grown increasingly
concerned about the unpredictable outcome as Greek cash reserves
dwindle down toward zero.
"The Greek government and their international partners need to work
to finalize a credible foreign program," a senior U.S.
administration official said, saying Washington was monitoring the
talks closely. "We're obviously encouraging all sides to continue to
focus on finding a solution that’s going to allow Greece to chart a
path to recovery."
(Reporting by Renee Maltezou, George Georgiopoulos, Lefteris
Papadimas, Gavin Jones and Deepa Babington in Athens, Roberta
Rampton in Washington and Leigh Thomas in Paris; Writing by Crispian
Balmer and Deepa Babington; Editing by Peter Graff and James
Dalgleish)
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