European leaders gave Greek Prime Minister Alexis Tsipras a straightforward choice on Sunday: disown his principles or quit the euro.In addition to requirements to cut pensions and raise sales tax, which Tsipras accepted last week, the memo demanded that officials from Greece’s creditors return to Athens with full access to government ministers and a veto over relevant legislation, according to the document.
Euro-area leaders also want Tsipras to transfer as much as 50 billion euros (US$56 billion) of state assets to an independent Luxembourg-based company for sale and make him fire the workers he hired in defiance of Greece’s previous bailout commitments.
After putting up with personal attacks, contradictory messages and an anti-austerity referendum from Athens, euro-area policy makers are pressing home their advantage with Tsipras’s resistance running out of fuel.Euro-area leaders presented Tsipras with a laundry list of unfinished business from previous bailouts he’d pilloried in opposition and during six turbulent months in office. They gave him three days to enact their main demands into Greek law in exchange for the third bailout in five years.
If Tsipras misses that deadline, Greece may be suspended from the currency union, Finnish Finance Minister Alexander Stubb said.
“Greece is being given exactly two choices,” Stubb said. “It’s a rather black-and-white choice.”
With Greece running out of money and its banks shut the past two weeks, the confrontation came at summit in Brussels Sunday that was billed as his last chance to stay in the euro. Greece missed a payment to the International Monetary Fund June 30 and allowed its second rescue package to lapse the same day.
Greece needs to pass laws by July 15 to raise sales tax, cut pensions, change the bankruptcy code, safeguard the independence of the statistics office and make spending cuts automatic if the budget misses its target, according to the text presented to leaders.
With Greek banks rationing cash and the ECB reviewing how long it can keep the country’s financial system alive, Tsipras won a stay of execution as he arrived at the summit when a Sunday meeting of the 28 European Union leaders was canceled. The full group of leaders would only have gathered to discuss how to handle Greece’s exit from the euro, Maltese Prime Minister Joseph Muscat said.
