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13/02 – Eurogroup meeting came close to agreeing statement on Greek debt

“Greece Deal Was Close Until It Suddenly Wasn’t,” reads a WSJE headline. Greece initially agreed to consider an extension of its bailout programme at a meeting of eurozone finance ministers on Wednesday before abruptly backtracking, dashing hopes of a quick resolution to the standoff between Athens and its creditors, the US newspaper explains.

In one of the draft texts, the “extension and amendment” of the current programme was mentioned. The Greek side held a positive stance towards this text, but it was rejected by German Minister of Finance Wolfgang Schäuble, Kathimerini reports. Greece objected to the word “extend” and Germany to “amend,” Corriere della Sera explains. Greek Finance Minister Yanis Varoufakis agreed to sign the statement, but after a phone call with Greek PM Alexis Tsipras, Mr Varoufakis backed out, Napi Gazdasag and report.

Mr Tsipras disagreed with the statement not criticising the bailout programme. President of the Eurogroup Jeroen Dijsselbloem said progress was made but it is not enough. Eric Bonse notes in Die Tageszeitung that Yanis Varoufakis’s tough stance in Brussels is “commendable,” but now he now needs to present concrete proposals. So far, he has not unveiled any real alternatives. Jeroen Dijsselbloem and Wolfgang Schäuble also need to come up with alternatives, as their policies have clearly failed, adds Bonse.

On Thursday the European Central Bank raised the amount of liquidity available to Greek banks, but only on a piecemeal basis. Last night a Greek government official confirmed leaked reports in the German press that Mario Draghi had increased the liquidity assistance line to Greek banks by €5 billion, up to €65 billion, reports El Mundo. All Greek media report that the ECB decided to extend the access of the Greek banks to ELA until 18 February and to increase it by €5 billion. ECB Executive Board member Peter Praet repeated that ELA is supplied to credible banks.

According to the information available, the ECB officials do not doubt the credibility of Greek banks, but they stress that the banks’ credibility depends on the credibility of the state, Greek media report. The ECB’s decision shows that the central bank will monitor more closely the supply of liquidity to Greek banks. The ECB will meet again on 18 February, in order to look into the extension of the ELA. The discussion on Greece’s financial situation continued at the EU summit on Thursday, and eurozone finance ministers will resume talks on Monday. ©EuropeanUnion2015

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