Greece reveals new debt deal, pensioners line up at banks

Athens/Berlin: The Greek government on Wednesday revealed its latest proposal for a debt deal with creditors to stave off a default and Grexit — exit from the eurozone — in the coming weeks even as thousands of pensioners lined up outside 1,000 bank branches opened to disperse pension payments.

The government dismissed media reports claiming that it fully accepted lenders’ offer ahead of a crucial Eurogroup teleconference rescheduled for Wednesday evening, Xinhua news agency reported.

Athens’ draft deal, which was submitted as Greece was declared in arrears to the International Monetary Fund (IMF) on Tuesday midnight. It sought a new two-year loan to deal with financing problems through the European Stability Mechanism (ESM), and requested a further restructuring of Greek debt.

“The Greek government has tabled a new proposal with a series of amendments to the institutions in a bid to achieve a mutually beneficial agreement,” a statement issued to the media said.

“Reports that Greece has accepted all the terms of the creditors’ proposal are unfounded,” it was stressed.

Athens released the letter Greek Prime Minister Alexis Tsipras addressed to European partners and IMF Managing Director Christine Lagarde.

“The Hellenic Republic is prepared to accept this staff level agreement (as published on the European Commission website on June 28, 2015) subject to the following amendments, additions or clarifications, as part of an extension of the expiring EFSF (European Financial Stability Facility) programme and the new ESM loan agreement for which a request was submitted on June 30, 2015,” Tsipras wrote.

“As you will note, our amendments are concrete and they fully respect the robustness and credibility of the design of the overall programme,” he added.

The Greek government requested that a 30 percent discount of VAT rates on islands be maintained, while agreeing to reduce the expenditure ceiling for military spending by 200 million euros ($222 million) in 2016 and 400 million euros in 2017.

The labour reform framework would also be legislated in autumn 2015.

Meanwhile, thousands of pensioners lined up early Wednesday morning outside 1,000 bank branches opened to disperse pension payments to those without bank cards, Efe news agency reported.

Capital controls imposed by the Greek government have left retirees restricted to withdrawing a maximum of 120 euros ($133.5) each week, while all Greek banks have been closed since Monday, and will stay closed until July 6, a day after the referendum on whether Greece should stay in eurozone.

Banks have committed to issue credit or debit cards for the pensioners as soon as possible.

The cards will allow retirees to withdraw 60 euros ($66.7) per day from ATMs, and also make payments in shops and gas stations, or any place that accepts the card.

In alphabetical order, 1,000 bank branches will open from Wednesday through Friday to serve pensioners, while banks of Piraeus, a Greek multinational financial services company, will remain open throughout, the Greek finance ministry announced on Tuesday night.

According to another Xinhua report from Berlin, German Chancellor Angela Merkel said on Wednesday there would be no negotiations over a new bailout programme to Greece before the country’s referendum on Sunday, though the door for talks remained open.

“We are waiting for the referendum. Before the referendum, there will be no negotiation over a new aid programme,” she told the lower house of German parliament in a special session, adding that “we can wait calmly… Europe is strong, much stronger than five years ago when the European sovereign debt crisis started.”

“The future of Europe is not at stake,” Xinhua news agency quoted her as saying.

On Saturday, Greek Prime Minister Alexia Tsipras said the country would hold a referendum on July 5 on the latest debt deal proposed by its international creditors.

Merkel on Wednesday reiterated that the door to talks with the Greek government “was always and will always remain open”, but she would not seek compromise at any cost.

“A compromise can only be reached when advantages outweigh disadvantages,” she said. “A good European is not someone who seeks an agreement at any price. A good European is rather the one that respects the European treaties and relevant national laws and help in this way to ensure that the stability of the eurozone is not damaged.”

Earlier on Wednesday, German Finance Minister Wolfgang Schaeuble said Greece’s latest proposals displayed no further clarity on what Athens wanted. As the second bailout programme for Greece expired on Tuesday midnight, the situation had totally changed, and there was no basis for a new deal with Greece at the moment, he said.