Greece extends closure of banks

Failure on Sunday – almost certainly – would lead to the European Central Bank turning off support and Greece would be on its own. Firstly, it has to deliver detailed reform plans by Thursday. But he said that a deal could not come at any price, noting that Greece had been “transformed into a laboratory for testing austerity over the past years”.

“With the Greek government it is every time manana”, Lithuania’s President Dalia Grybauskaite said using the Spanish word for tomorrow.

But that domestic victory did not appear to give him much leverage in talks with foreign creditors, who know Tsipras needs a deal soon to keep his country afloat.

Greek banks remain closed for a second week with ATM withdrawals limited to 60 euros a day, amid fears that the economy is headed towards collapse and possible “Grexit”.

So it was with astonishment and dismay that European leaders learned Tsipras did not yet have a written proposal for new rescue aid. I have no doubt that this will affect all of Europe, also in the geo-political sense.

Greece’s eurozone partners have steadfastly said they want to help Greece stay in the currency club but have just as often complained about Greece dragging its feet during months of negotiations.

The Greek leader declared that he was not seeking a “rupture” with Europe but rather a “socially just and economically viable agreement without the mistakes of the past, that caused a recessionary spiral”. We are ready to review and evaluate actual work from the Greek government, instead of continuing to listen to unrealistic plans, ” Reirs said.

Renowned economists including Thomas Piketty and Jeffrey Sachs also published an open letter to Merkel urging the leader of Europe’s biggest economy to cut Greece’s debt to “avoid further disaster”. A spokesman for the country’s hardline Finance Minister Wolfgang Schäuble said any fresh bailout deal would not include “classic” debt relief such as writedowns of Greece’s €320 billion borrowings.

He is now meeting cabinet ministers and finance officials to finalise the new proposals, before the deadline of 22:00 GMT. “The stark reality is that we have only five days left to find the ultimate agreement”.

Prime Minister Alexis Tsipras met with finance ministry officials and was holding a cabinet meeting Thursday afternoon to finalize his country’s plan, a day after his government requested a new three-year aid program from Europe’s bailout fund and promised to immediately enact reforms, including to taxes and pensions, in return.

International Monetary Fund chief Christine Lagarde reiterated Wednesday that Greece’s massive debt would need restructuring, something that Germany – Greece’s largest European lender – has resisted. That’s something many European leaders – including Germany’s Angela Merkel – have ruled out.

The beleaguered country will get one last chance to convince its creditors to loosen their purse strings or face the prospect of a default and financial oblivion. So it’s curious that Greece has been given five more days to come up with a credible plan to receive another bailout package.

Reuters reported last night that Greek banks will have to close or merge, even if there is a deal – due to the financial damage already done.

Normal commerce is now impossible in Greece. Creditors have given the Greek government until Sunday to find a solution. And suppliers are demanding that businesses pay cash up front.

People line up Wednesday in Athens at the main gate of the national bank of Greece as they wait to withdraw a maximum weekly amount of 120 euros ($134 US).

Markets are holding up despite the apparent ultimatum, with many investors predicting a last-minute deal.

Belgian’s Prime Minister Charles Michel said: “We can’t do it with a gun to our head or a knife at our throats”.