Head of the European Parliament Martin Schulz says a five-year "timeout" from the euro for Greece is "off the table." The idea was earlier voiced by German Finance Minister Wolfgang Schaeuble.
FOLLOW LIVE UPDATES: EU leaders struggle to reach bailout compromise
"This five-year exit idea is off the table. We don't need to talk about that anymore," Schulz told Deutschlandfunk radio, as cited by Reuters. "In Brussels, things are on a knife edge and the eurozone could fly apart," added Schulz, who said his SPD party wanted Greece to stay in the euro.
Διακοπή #EuroSummit -Τετραμερής συνάντηση @PrimeministerGR@atsipras - @fhollande - #Merkel - @eucopresident. #Greecepic.twitter.com/nn9JjzudUJ
— Ευρωπαϊκή Επιτροπή (@EEAthina) July 12, 2015
Earlier, the Eurogroup presented a draft reform plan that would have left Greece with the option of taking a "timeout" from the euro, or accepting the harshest reform package yet to secure a new bailout.
The draft was leaked on Sunday afternoon and reportedly discussed face-to-face by German Chancellor Angela Merkel, French President Francois Hollande and European Council President Donald Tusk and socialist Greek leader Alexis Tsipras. In the meeting, which one senior official described to the Guardian as “extensive mental waterboarding,” the leaders presented Tsipras with an ultimatum, of either agreeing to a €82-86 billion ($91-$95.5 billion) bailout attached to an extensive reform plan by Wednesday, or exiting Europe’s common currency.
Here’s the full 4pg eurogroup document on #Greece, inc “time-out”, total amt needed (€82-6bn) & reform proposals pic.twitter.com/sKUpbykcBX
— Ed Conway (@EdConwaySky) July 12, 2015
The proposed document demanded that Athens “reviews collective bargaining and industrial action agreements,” liberalizes its energy sector, and implements a “significantly scaled up” privatization program. In a disputed measure – left in square brackets in the text – is a proposal that €50 billion ($55.45 billion) of Greek assets would be transferred to an independent European body, to be privatized.
Here's the list of reforms in the #Eurogroup draft that Greek government has to pass by Wednesday to get bailout pic.twitter.com/nEF8OmDBiA
— Tara Palmeri (@tarapalmeri) July 12, 2015
The document does admit that “there are serious concerns regarding the sustainability of Greek debt” but blames the “easing” of IMF-directed policies during the past 12 months for the burden of sovereign debt, which stands at over €300 billion (roughly ($333 billion).
Most importantly, in the last line, also in square brackets, the Eurogroup says that "Greece should be offered swift negotiations on a time-out from the euro one, with possible debt restructuring if necessary in a Paris Club-like format over at least the next five years."
Greek official: €zone’s plan for privatizing €50B of greek assets is “on another planet” for @atsipras & temporary #Grexit "100 percent No.”
— Tara Palmeri (@tarapalmeri) July 12, 2015
An unnamed Greek official described the leaked proposal as “humiliating and disastrous,” according to EU news portal Euractiv, with several observers suggesting that Germany and several other mostly northern European countries are actively making the option of leaving the eurozone more attractive to Greece, having lost faith in the Tsipras government.
3. No haircuts inside euro but a "possible restructuring" if Grexit is a huge sweetener designed to boost support for Grexit in Greece.
— Karl Whelan (@WhelanKarl) July 12, 2015
Tsipras himself faces a domestic rebellion after his apparent about-turn, following a referendum in which Greeks said no to a new European bailout last Sunday. The conditions offered then were more generous than those in the latest proposal, and several prominent left-wingers from Tsipras’ Syriza party have called on him to resign.
On Sunday, an anti-austerity crowd gathered in front of the parliament building in Athens, still holding the “No” banners printed out before last week’s vote.