The Latest: Finland lays out what’s at stake with Greece

The Associated Press
AP

BRUSSELS (AP) — The latest on the Greek financial crisis (all times Brussels local):

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2:10 p.m.

Finnish Finance Minister Alexander Stubb has summed up just what is on the line financially for his small country in the Greek negotiations — a whopping 10 percent of Finland’s annual budget.

On his way into a meeting with his peers in the 19-country eurozone, Stubb said Greece owes Finland 5 billion euros — a big dent in its budget of 50 billion.

It’s also equivalent to 2.5 percent of Finland’s annual GDP, he said.

“So a lot is obviously at stake,” he said.

Stubb says the meeting is not aimed at kicking Greece out of the euro, but that it’s up to Greece’s leaders to come up with credible proposals to secure a bailout deal.

“We need to see some political will, a change of attitude on the part of the Greek government in order for this to work,” Stubb says.

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1:50 p.m.

Lithuania only started using the euro currency this year and doesn’t want the 19-country single currency club to start losing members now.

Lithuanian Finance Minister Rimantas Sadzius said a Greek exit “is not an option for us,” as arrived for the meeting of eurozone finance ministers in Brussels to discuss a possible new bailout deal for Athens.

Sadzius said he believes common ground can be found. Greece’s new finance, Euclid Tsakalotos is set to unveil new proposals to his peers in the eurozone.

“In politics, there is always room for compromise,” said Sadzius. “We believe that the eurozone should expand rather than contract.”

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1:30 p.m.

German Finance Minister Wolfgang Schaeuble says Berlin still opposes an actual debt cut for Greece as he arrived at a meeting with his counterparts in the 19-country eurozone.

Schaeuble said he’s waiting with interest to hear the ideas of the Greek government but stressed that without an aid program, there is “no possibility to help Greece within the framework of the eurozone.”

Germany is reluctant to consider a debt cut for Greece. The Greek government wants debt relief for the country to be near the top of bailout discussions. That doesn’t necessarily mean an actual reduction in the amount owed — it could take the form of extending the country’s repayment schedule.

Schaeuble said actual debt cuts are banned under European rules.

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1:05 p.m.

Jeroen Dijsselbloem, the eurozone’s top official, says the pressure is on Greece to come up with fresh economic proposals that meet the requirements of its partners in the single currency bloc.

Arriving for talks with his peers in the 19-country eurozone, Dijsselbloem said the Greek government has “a major interest” in bringing forward “serious and credible” proposals that are needed if Greece is to get another bailout.

Greece is running out of time to secure a deal that will help its banks reopen and avoid a disorderly euro exit.

The eurogroup president also said the resignation of Yanis Varoufakis, Greece’s outspoken finance minister over the past few months of the protracted bailout discussions, would not necessarily make a difference. Varoufakis has been replaced by the more mild-mannered Euclid Tsakalotos.

“It is not about persons,” Dijsselbloem said. “It is about where we stand after the ‘no’ referendum.”

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12:45 p.m.

If new Greek Finance Minister Euclid Tsakalotos has revised proposals for a fresh bailout of his debt-ridden nation to show his peers in the 19-country eurozone, he was keeping them close to his chest as he arrived for talks in Brussels.

A day after being sworn in to replace Yanis Varoufakis, who quit after Sunday’s referendum ‘no’ vote, Tsakalotos hurried into the meeting venue without speaking to reporters.

On Monday, he conceded: “I won’t hide from you that I am very nervous and very anxious.”

And in something of an understatement, Tsakalotos said after being sworn in, “I am not taking over at the easiest moment in Greek history.”

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12:10 p.m.

Dutch State Secretary for Finance Eric Wiebes says Greek representatives need to come up with a serious package at the meeting of eurozone finance ministers if fresh bailout talks are to make any progress.

“I hope they bring a very serious proposal in their luggage,” Wiebes said as he arrived an hour early for the start of the meeting in Brussels. “Because it is only worth continuing to talk on the basis of a very serious proposal. I can’t imagine the proposal would be less serious than the proposal that was already on the table.”

Wiebes, a junior Dutch minister, attends the eurogroup meetings because Dutch Finance Minister Jeroen Dijsselbloem is the group’s chairman.

The Greek government is expected to make fresh proposals at the meeting in order to secure a bailout deal so it avoids leaving the euro.

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11:55 a.m.

Rarely, if ever, has any leader gone to Brussels for a summit with as much as stake as Greek Prime Minister Alexis Tsipras.

With his country on its economic knees and facing the prospect of a disorderly exit from the euro, Tsipras knows that Greece’s future for years if not decades could hinge on how talks later pan out.

Neil MacKinnon, global macro strategist at VTB Capital, spelled out what’s at stake.

“The Greek economy is in danger not just of imploding but of falling into a nightmarish dysfunctionality where what we consider as the normal economic functions of society collapse,” he said. “This is a recipe for anarchy and social disorder.”

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11:30 a.m.

As Europe’s leaders gear up for an emergency summit on Greece, the big euro sculpture in front of the former European Central Bank headquarters in Frankfurt is being given its first overhaul after 13 years.

The blue sign surrounded by yellow stars has become a popular photo motif for visitors.

The long-planned work started Monday, coinciding with the aftermath of the Greek referendum that many fear could lead to the first exit of a country from the 19-nation currency.

Workers took down the blue and yellow glass Plexiglas plates that cover the sculpture, which are to be replaced. New lighting also is to be installed, and work is due to be completed by Friday.

The sculpture by Ottmar Hoerl is owned by a private group, the Frankfurt Culture Committee.

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11:10 a.m.

While Europe’s leaders headed for Brussels for what could be a make-or-break summit for Greece’s future in the euro, Greeks continued to struggle with the strict controls on their bank withdrawals.

Amid signs that the banks were fast running out of cash, there are growing concerns about what will happen to people’s savings. Banks have been shuttered for over a week and cash withdrawals have been limited to 60 euros a day.

Giorgos Stathopoulos, a 46-year-old civil servant said many ATMs had run out of 20-euro notes, effectively reducing the daily limit to 50 euros.

“The problem is for those of us who don’t have big deposits, what happens with our savings, that is the concern,” he said.

And Giorgos Kafkaris, a 77-year-old pensioner, is hopeful about improvements. “I believe something better will happen,” he said.

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9:35 a.m.

European Commission President Jean-Claude Juncker has tempered expectations of a swift solution to the Greek crisis, saying “a solution is not going to appear overnight.”

Juncker told lawmakers at the European Parliament in Strasbourg that any solution later at a meeting of the eurozone’s 19 leaders in Brussels would likely be “overly simplistic.”

He said one of the purposes later is to “restore order to the situation.” He also displayed his anger at attacks on the European Union’s executive branch.

“I think it is unacceptable for the European Commission to be deemed terrorists by the Greek government,” he added.

Greek Prime Minister Alexis Tsipras and new finance minister Euclid Tsakalotos are on their way to Brussels for meetings aimed at restarting bailout talks.

“Quite clearly the ball lies in the court of the Greek government,” said Juncker.

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9:10 a.m.

European stock markets have opened solidly ahead of an emergency meeting of eurozone leaders in Brussels, where Greek Prime Minister Alexis Tsipras is expected to reveal fresh proposals to the country’s creditors.

Germany’s DAX index was up 0.4 percent while the Stoxx 50 index of leading European shares rose 0.2 percent.

With Greece’s banks shuttered and cash reserves run dry, time is running out for a bailout deal. Some investors hope the resignation of Yanis Varoufakis on Monday may well help smooth discussions.

Still, few are optimistic and many analysts think that a Greek exit from the euro remains possible.

“It seems untenable that Greece can slide out of the Eurozone with barely a whimper being heard in financial markets, but right now that’s what it looks like,” said Tony Cross, market analyst at Trustnet Direct.

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8:50 a.m.

Germany’s biggest-selling newspaper knows who it wants to see at Tuesday’s emergency summit of eurozone leaders in Brussels: the Iron Chancellor.

The Bild daily’s front page Tuesday featured an image of Chancellor Angela Merkel in a Prussian-era spiked helmet. “No new billions for Greece,” its headline read. “Today we need the Iron Chancellor.”

That’s how Otto von Bismarck, the 19th-century leader under whom Germany was unified, was known.

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8:40 a.m.

Germany’s EU commissioner says he’s optimistic that a new Greek finance minister and opposition parties’ backing for Prime Minister Alexis Tsipras could smooth negotiations between Athens and its European creditors.

Tsipras’ polarizing finance minister, Yanis Varoufakis, resigned Monday and was replaced by Euclid Tsakalotos. Three opposition parties offered backing for Tsipras in the bailout negotiations.

Commissioner Guenther Oettinger told Deutschlandfunk radio Tuesday that Tsakalotos “doesn’t have the same attitude as his predecessor. He knows the figures, the facts, he knows our reform proposals … and he knows that we are flexible.”

German officials insist that, even after its voters rejected more austerity in a referendum, Greece must accept conditions for any new aid.

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8:19 a.m.

French Prime Minister Manuel Valls says his country will do everything possible to keep Greece in the eurozone, saying its exit would be a “risk for global economic growth.”

In an interview with the RTL radio network Tuesday, Valls denied that Greece’s “no” vote was a rejection of Europe or its values but rather an expression of pride. He called on Greece’s prime minister to put forward a plan and said France would be open to rescheduling Greece’s debt.

Valls says: “The eurozone must stay coherent, reliable. Europe is not just a currency. It is a conception of the world.”

Greek Prime Minister Alexis Tsipras is headed Tuesday to Brussels to negotiate a rescue deal with European lenders.

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