Athens---Greek Prime Minister Alexis Tsipras on Friday said the country was close to a default-saving reform deal but called on EU-IMF creditors to withdraw "absurd" demands for further austerity cuts after ducking a loan repayment to the IMF.
"I believe we are now closer than ever to a deal," Tsipras said in a speech to parliament as he faced criticism from the opposition on the state of the negotiations.
But Tsipras insisted that any agreement had to include debt relief in order to be a "definitive" solution to the Greek crisis, and he rejected proposals made by the country's international creditors this week.
"It is clear that the Greek government cannot under any circumstances consent to absurd proposals," the PM said.
Athens had earlier ramped up pressure in the make-or-break negotiations after postponing a loan repayment due Friday, and securing time to reach a deal compatible with its anti-austerity programme.
Tsipras, 40, is under pressure from hardliners in his party insisting on a firm rebuttal of austerity demands.
Athens had been scheduled to repay the International Monetary Fund 300 million euros ($340 million), but late Thursday it announced it would bundle all four IMF remittances totalling 1.6 billion euros due this month in a single June 30 payment.
Dodging the threat of an immediate default, Greece has bought more time to negotiate with its creditors -- the European Union, IMF and European Central Bank -- who are demanding tough reforms before releasing the final 7.2 billion euros in bailout funds.
But the move rattled investors, with the Athens Composite Index falling by more than five percent before closing 4.96 percent down Friday.
Many worry that a default would set off a chain of events that could lead to a messy Greek exit from the euro.
"Tsipras will need some concessions by creditors on key items to win over critics in his own party: either by dropping requirements to increase sales tax or by scrapping benefits for low pensions, together with some gesture in terms of debt relief," IHS Global Insight senior economist Diego Iscaro said in a note.
"If creditors do not concede on either of these, then default risks would increase rapidly," he said.
Next week Athens will seek to raise nearly 2.3 billion euros in six- and three-month treasury bills.
AFP
