Greece's Tsipras tries to rally support for austerity deal
By DEREK GATOPOULOS and ELENA BECATOROS, Associated Press
Jul 10, 2015 6:04 PM CDT
Greece's Prime Minister Alexis Tsipras prepares to speaks during a parliament meeting in Athens, Saturday, July 11, 2015. Lawmakers have been summoned to emergency sessions in parliament after Prime Minister Alexis Tsipras sought authorization to negotiate a new bailout deal with European creditors....   (Associated Press)

ATHENS, Greece (AP) — Greece's prime minister acknowledged Friday the reforms his government has proposed in return for a third bailout are harsh and include measures far from his party's election pledges, but insisted they were Greece's best chance to emerge from its financial crisis.

In a speech delivered after midnight and with strong personal overtones, Alexis Tsipras sought to persuade lawmakers, including dissenters within his own left-wing Syriza party, to back the proposals and grant his finance minister the authorization to use them as a basis for negotiations with creditors over the weekend.

A vote was expected at about 3 a.m. Saturday.

Tsipras said his government had made mistakes during his six-month tenure but said he had negotiated as hard as he could.

"There is no doubt that for six months now we've been in a war," he said, adding that his government had fought "difficult battles" and had lost some of them.

"Now I have the feeling we've reached the demarked line. From here on there is a minefield, and I don't have the right to dismiss this or hide it from the Greek people," he said.

But he insisted the latest proposal contains measures that would help the economy and, if approved by Greece's creditors, would unlock sufficient financing for the country to emerge from its protracted crisis and see its massive debt tackled.

The proposed measures, including tax hikes and cuts in pension spending, are certain to inflict more pain on a Greek public who just days ago voted overwhelmingly against a similar plan.

But the new proposal, if approved by Greece's international creditors, will provide longer-term financial support for a nation that has endured six years of recession.

If approved, Greece would in turn get a three-year loan package worth nearly $60 billion (53.5 billion euros) as well as some form of debt relief. That is far more than the 7.2 billion euros left over from Greece's previous bailout that had been at stake in the country's five-month negotiations until last month.

Defense Minister Panos Kammenos, who heads the government's junior coalition member Independent Greeks, said he was advocating a vote in favor of the proposal even though it goes against his party's principles. The party holds 13 seats in the 300-member parliament.

"I want to state clearly, I am not afraid of Grexit," he said, referring to the possibility of Greece leaving the euro. "I am afraid of one thing: national division and civil war."

He said he feared failure to get a deal with creditors would eventually lead to civil strife.

Greece's latest proposal was sent to rescue creditors who were to meet this weekend to decide whether to approve it. The country has relied on bailout funding since losing access to financing from bond markets in 2010.

The new measures overturn many of the election promises of Tsipras' left-wing Syriza party, which had vowed to overturn bailout austerity, and come less than a week after 61 percent of voters opposed similar reforms, proposed by creditors, in last Sunday's referendum.

The coalition government has 162 and pledged backing from a large section of opposition lawmakers. But a significant loss of votes from his own government could topple Tsipras' coalition.

Greece's major creditors — the International Monetary Fund, the European Central Bank and other eurozone nations — were already fine-combing through the proposals before sending them to the other 18 eurozone finance ministers Saturday. A summit of the full 28-nation European Union in Brussels was to consider them on Sunday, with hopes for a deal before midnight.

French President Francois Hollande described the measures as "serious and credible," though Germany refused to be drawn on their merits. France's Socialist government has been among Greece's few allies in the eurozone during the past months of tough negotiations, with Germany taking a far harder line.

Jeroen Dijsselbloem, the Dutch finance minister who chairs the meetings of the eurozone finance ministers known as the eurogroup, said the proposals were "extensive" but would not say whether he considered them sufficient.

As the government inched closer to a deal to ensure Greece isn't jettisoned out of Europe's joint currency, some Greeks were furious at the proposed measures.

"If this is Europe, then we don't want this Europe," said Aristidis Dimoupulos, a marketing professor in Athens. "If this is the eurozone, we don't care if we go out or in. If in this life we'll be slaves, it's better to be dead."

Others adopted a wait-and-see approach.

"I don't know. The chances are 50-50" for a deal, said Athens resident Omiros Fotiadis.

Meanwhile, banks remained closed since the start of last week and cash withdrawals were restricted to 60 euros ($67) per day. Although credit and debit cards work within the country, many businesses refuse to accept them, insisting on cash-only payments. All money transfers abroad, including bill payments, were banned without special permission.

Alternate Finance Minister Dimitris Mardas said the banks would be gradually restored to operation. They are set to remain closed through at least Monday.

Experts said it is unlikely, even in the event of a deal, that limits on cash withdrawals and transfers will be lifted completely for some time.

Several thousand anti-government protesters demonstrated in central Athens Friday night in a communist-backed rally.

The main governing party, Syriza, a fractious coalition of left-wing groups, had resisted a new loans-for-austerity deal, arguing the country is too weak to endure it with a quarter of the labor force out of work and a growing number living in poverty.

But it was forced to resume talks with creditors as Greek banks faced the prospect of collapse within days if the country did not receive a new rescue package.

In return, the government said it would seek debt relief — likely in the form of lengthened repayment periods and lowered interest rates — a notion that was gaining ground internationally despite reluctance in Germany.

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Associated Press writers Anna Psaroudakis in Athens, Angela Charlton in Paris and Mike Corder in the The Hague, Netherlands, contributed to this report.

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Follow Derek Gatopoulos at http://www.twitter.com/dgatopoulos and Elena Becatoros at http://www.twitter.com/ElenaBec

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