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05/06 – Greece delays IMF payments as it drafts counter-offer

Most media outlets report that Greece has opted to invoke a little-used option allowing it to defer the payment of the €300 million it owes to the IMF and that was due today, with many newspapers’ front pages – The Guardian, FT and ABC – leading with the news.

The IMF gave its green light to Greece to pay all the four tranches of June worth €1.6 billion at the end of the month. Mega TV highlights that during Thursday’s press conference, IMF Managing Director Christine Lagarde appeared certain that the tranche will be paid. Yet the IMF insists on the hard line, the channel comments. According to the current data, the IMF will not participate in the agreement, which will be settled between Greece and the EU.

Diário Económico comments that this was a political decision, as the government has enough financing to honour the payment – something El Mundo‘s Pablo R. Suanzes agrees with when he suggests that “what is left in Greece’s bailout talks is not technical-level discussions, but top-level politics”. Postponing the IMF payment is seen as a way to increase pressure on creditors, at a moment when a deal seems close, Diário Económico further explains. Les Echos says this development emphasises that the proposals of the creditors, who have shown “considerable flexibility” according to Christine Lagarde, have been badly received by the Greek government.

The efforts demanded to Athens are considerable, and two measures are considered particularly unacceptable: cuts in spending on pensions and the increase of VAT for a series of products and services. This shift indicates that negotiations could continue much longer, the newspaper adds. Naftemporiki believes that Greek PM Alexis Tsipras sent a clear message to the creditors that an agreement between Greece and the partners cannot include “extreme positions” yesterday. The newspaper also says that the government intends to submit an updated draft agreement in the immediate future on the basis of the initial 47-page document.

On NDR, Thomas Bormann comments that Alexis Tsipras is “playing for time” but time is “working against” Greece. The longer the negotiations take, the deeper Greece is “sinking into a swamp of debt,” he says. The on-going negotiations have been “paralysing” the Greek economy for four months already, therefore Alexis Tsipras is trapped in a “vicious circle” and he should find a compromise with the creditors as soon as possible, Mr Bormann concludes.

In an op-ed in Libération, Maria Malagardis emphasises that “the arm wrestling between Greece and its creditors actually continues to hold Europe in suspense”. She adds that for six months, each meeting has been announced as the “last chance one,” commenting that the one between Alexis Tsipras and EC President Jean-Claude Juncker on Wednesday meets this scheme. Many media continue to comment on the meeting between Tsipras, Juncker and Dijsselbloem on Wednesday.

Mega TV reports that Christine Lagarde welcomed the meeting, characterising it as “constructive” and underlining that it “offers a window of opportunity to the negotiation”. Il Sole 24 Ore believes that after the meeting, the distance between the two counterparts has been reduced and an agreement seems to be close. The newspaper adds that by now, Mr Tsipras is negotiating on two different frontlines, one in Brussels and one in Athens, where his party is threatening a government crisis, too.

La Stampa and El Pais report that Greece’s Finance Minister indeed claimed it is impossible to find an agreement by relying on the talks between Greece, the European Commission, the ECB and the IMF, and thus the final proposal presented to Greece by its EU partners has been met with dislike in Athens. The Syriza government is “flirting with default as it steps up efforts to win some last-minute concessions and avoid crossing many of its red lines”, the Spanish newspaper explains. adds that Syriza is actually threatening a government crisis if the agreement is too strict for ordinary Greeks. In a commentary in La Stampa, Marco Zatterin says that nobody in Brussels is sure anymore whether a Grexit or Greece’s default will occur. Gunnar Jonsson sums the situation up in Dagens Nyheter when he says that “the usual theatre continues in the Greek drama: Alexis Tsipras says an agreement is close, while the other euro countries wonder what he is talking about and Mr Tsipras´ left-wing populist ministers in Athens say that all demands are unacceptable.”

Die Welt believes that the second rescue programme for Greece might be extended until the autumn, as there seems to be no other way in order to help Greece over the summer.

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