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On 26 June the Greek authorities decided to reject the proposals by the institutions (the European Commission, the European Central Bank and the International Monetary Fund) for Greece’s reforms plan. The plan, which has been negotiated since February, is a precondition to unlocking the remaining financial assistance for Greece under the current arrangement.
The Greek government decided to call for a referendum on these proposals. It is expected to take place on Sunday, 5 July 2015, after the expiration date of the current arrangement.
The current financial assistance arrangement with Greece expires on 30 June 2015. All other arrangements related to Greece’s current programme, including transfer by euro area member states of securities markets programme (SMP) and agreement on net financial assets (ANFA) profits expire on the same date.
In a statement issued after the first part of the meeting, 18 Eurogroup members regret that the proposal by the institutions has been rejected by the Greek authorities unilaterally.
The Eurogroup will discuss further steps to ensure financial stability in the euro area.
Remarks by Eurogroup President at the intermediary Eurogroup press conference on 27 June 2015
Good afternoon. Let me first make some preliminary remarks. Firstly, we have set out our conclusion in an Eurogroup statement, which will be distributed to you. Maybe you already have it. This was not agreed by the Greek representative in the Eurogroup. It was a statement by 18 ministers and you will see a footnote making it clear that the Greek representative in the Eurogroup cannot agree with this statement. Second preliminary remark, we will immediately after this press conference have a second meeting to discuss any consequences from the political conclusion just drawn and to prepare for whatever is needed to make sure that at all times the stability of the Eurozone remains at its high level.
As I said this morning when I came into the building, we were negatively surprised by the steps that the Greek government took last night. First of all, if you remember after the last Eurogroup, I said that the door was still open and we were still prepared, and the institutions were still prepared, to look at last proposals from the Greek side and to continue talks. These talks were actually going on last night between the institutions and the Greek authorities when the Greek representatives were called out and had to leave the meeting. This took place last night and that basically brought the talks to an end. Very quickly it was made clear why that took place.
The Greek government has decided to respond negatively to the proposals which the joint institutions had put on the table. They rejected those proposals and the joint opinion of the other 18 members of the Eurogroup is that they very much regret this, and they regret that last night’s talks were broken off and that today no further negotiations or talks were possible. Not only the Greek government rejected the last proposals by the institutions, they have to realise that those proposals made maximum use of the flexibility that the Eurogroup allowed in this process. We address those two kinds of flexibility in our statement of 20 February. We were prepared to take into account the recent economic developments in Greece, that there has been major setback in the economic situation, and secondly there was flexibility to allow the new Greek government to propose alternative ways to bring Greece back onto a sustainable path, fiscally, economically, and in terms of financial stability.
The institutions, in their proposals, made maximum use of that kind of flexibility. Nonetheless, the Greek authorities have rejected those proposals and decided to put a proposal to their parliament, which is debated right now, to have a referendum with a negative advice on the proposals. The process wasn’t finished, as far as we were concerned, the proposals weren’t definitive; they weren’t formally discussed or decided in the Eurogroup, yet the Greek government has broken off the process, has rejected the proposals and is now putting them, which is also an unfair way, to the Greek people, to a referendum with negative advice.
Given that situation, we must conclude that, however regretful, the programme will expire on Tuesday night. That is the last date that we could reach an agreement and it will expire on Tuesday night. And, as I said, we will reconvene after this press conference to look at further steps to take, determined as we are to maintain strength and credibility of the Eurozone. That is all.
UPDATE 22:10 PM CET
Good evening everyone. I [Jeroen Dijsselbloem] would like to report back to you about the informal ministerial meeting we had following the break-up of negotiations with the Greek authorities last night and the Eurogroup meeting earlier today. This informal meeting was held at the request of a number of ministers. We were informed by the institutions; we discussed the forthcoming expiration of the current EFSF financial arrangement with Greece and any consequences that may come from that. We discussed the strength and the preservation of the monetary union. Coming out of the financial crisis, a lot of measures have been taken, frameworks put in place, institutions have been built, which have strengthened and deepened our cooperation, and strengthened our monetary union. We are in a much stronger position, certainly more than before the crisis. Also, I would like to stress the point that all of us, euro area member states intend to make full use of instruments available to preserve the integrity and stability of the euro area, to complement any actions the ECB will take in full independence and in line with its mandate. The EFSF and ESM remain strong instruments with our full backing, as they have always been. We will take any necessary measures to further improve the resilience of our economy as an ongoing process.
I would like to stress that the expiry of the EFSF financial arrangement with Greece without a prospect of follow-up arrangements will require measures by the Greek authorities. The institutions stand ready to provide technical assistance to safeguard the stability of the Greek financial system.
The Eurogroup – and that consists of 19 members, I would like to stress – will monitor very closely the situation in Greece, stand ready to reconvene, to take appropriate actions when and where needed in the interest of both Greece and the Eurozone. We also, and this goes also for the Commission and the other institutions, stand ready to support and assist Greece and the Greek people if and when required following the expiration of the financial arrangement with Greece. This is all I have to say. The institutions will provide any technical information you want from them, on risks or possible measures. It is not up to me to communicate on a technical level.