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Greek PM Tsipras rules out turning to Russia for aid
February 2, 2015 / 10:53 AM / in 3 years

Greek PM Tsipras rules out turning to Russia for aid

Il neopremier greco Alexis Tsipras.Alkis Konstantinidis

NICOSIA (Reuters) - Greek Prime Minister Alexis Tsipras ruled out seeking aid from Russia and said on Monday he would pursue negotiations for a new debt agreement with European partners but met little sign of compromise from Germany.

As the new Greek government continued a diplomatic offensive to replace its current bailout accord with the European Union, European Central Bank and International Monetary Fund "troika", Tsipras said he was not looking for any new backers.

"We are in substantial negotiations with our partners in Europe and those that have lent to us. We have obligations towards them," he said at a news conference in Cyprus during his first foreign visit as prime minister.

"Right now, there are no other thoughts on the table," he said, when asked whether Greece would seek aid from Russia, which has suggested it could be willing to listen to a request for support from Athens.

Greece, unable to borrow on the markets and facing pressure to extend the current support deal when it expires on Feb. 28, is looking for a bridging agreement that would give it breathing space to propose a new debt arrangement, including a package of economic reforms.

However Tsipras repeated calls already made by his finance minister Yanis Varoufakis for the troika mechanism to be dismantled and replaced by direct negotiations between Athens and its EU and IMF partners.

"I believe that this would be a mature and necessary development for Europe," he said but met an immediate rebuff from Germany, which said the troika controls were agreed as part of the bailout and should remain in place.

"The German government sees no reason to scrap this mechanism of evaluation by the troika," finance ministry spokeswoman Christiane Wirtz said in Berlin.

As Tsipras was speaking in Cyprus, Varoufakis was due to meet investors in London where he was expected to try to calm fears that Athens would not be able to keep servicing its 320 billion-euro (241.13 billion pounds) debt.

Tsipras continues a series of foreign visits on Tuesday, when he is due to meet Italian Prime Minister Matteo Renzi, one of the main voices in Europe calling for an end to rigid budget austerity.

He sees European Commission President Jean-Claude Juncker and French President Francois Hollande on Wednesday but so far no date has been set for a meeting with German Chancellor Angela Merkel, who will have a key say over any new deal with Greece.

However the two will both be at the European Council meeting on Feb. 12 where they may meet at the sidelines.

Despite German resistance to the idea of a new deal on Greece, Tsipras said the tide of debate in Europe had been unexpectedly encouraging for Athens, with more and more backing for the idea of a change of direction in Europe.

"I never expected that there would be such strong forces helping the new government create a new framework and set a new course, not only about Greece but Europe as a whole, because Europe is in a crisis," he said.

He ruled out Greece leaving the euro but said it would be a mistake to assume that Greece and Cyprus, whose banking system had to be bailed out by the troika in 2013, were not essential to the stability of the single currency.

"The EU and eurozone would be both dismembered along their southeastern flank without Greece and Cyprus," he said.

The Greek prime minister, whose government has clashed with some European partners over its reluctance to pursue sanctions against Russia, said he discussed with Cypriot President Nicos Anastasiades the need for a coordinated stance for a "bridge of peace and cooperation between Europe and Russia."

Tsipras also said his government would strongly support the Cypriot government's efforts to seek a reunification of the island, which was split in a Turkish invasion in 1974 triggered by a brief Greek-inspired coup.

writing by Deepa Babington and James Mackenzie; editing by Philippa Fletcher

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