European Union leaders called an emergency summit Monday to prevent Greece from defaulting on its 1.5 billion euros ($1.7 billion) debt payment to the International Monetary Fund at the end of the month, after finance ministers’ efforts in a Luxembourg meeting failed on Thursday, according to Bloomberg.
“It is time to urgently discuss the situation of Greece at the highest political level,” EU President Donald Tusk said in a statement.
Greece will need to agree to reforms to get its bailout program extended and won’t receive any more funds if it doesn’t, Eurogroup President Jeroen Dijsselbloem told reporters. The country already can’t get funds at the end of the month even if there is an agreement, because there is now not enough time for some parliaments to sign off.
“Let’s say that we do reach an agreement, it’s unthinkable that the implementation and then disbursement will also have to take place before the end of the month,” Dijsselbloem said. “That is simply impossible.”
Without a settlement, the ties still binding Greece to the euro may begin to unravel with emergency funding for the banking system under review and the risk of capital controls mounting.
Asked if he could imagine Greece being forced out of the euro, Dijsselbloem said, “The way it goes now we’re going in that direction.”
On Friday, a Greek bank official said that the European Central Bank had agreed to increase emergency lending to Greek banks, as deposit outflows continue to plague the country’s financial institutions.
Greek Finance Minister Yanis Varoufakis said that je had made a new and credible offer to its creditors at the Luxembourg meeting.
But after listening to Varoufakis’s comments, IMF Managing Director Christine Lagarde said: “The key emergency is to secure a dialogue with adults in the room. What we lack is a dialogue.”
Meanwhile, thousands of Greeks protested against the Leftist government’s stance that could lead to Greece being kicked out of the eurozone, Bloomberg said.
“’Hellas, Europe, Democracy,’ the protesters shouted, swarming past the presidential guards to wave Greek and EU flags on the steps of the parliament building,” Bloomberg wrote.