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Greek FM meets Draghi, Schaeuble next

Wednesday, February 04, 2015 - 02:26

Greece says it can conclude discussions with its international lenders in a short space of time. But that's assuming it can count on the support of the European Central Bank. As David Pollard, reports some aren't convinced they will get it.

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The Greek flag raised on a Brussels flagstaff for a visit by the EU's newest prime minister. Would the same happen in six month's time, euro sceptics might ask. Or could Greece by then no longer be part of the club? For now, it's an official welcome for Alexis Tsipras from European Council President Donald Tusk. Unexpected warmth from Commission chief Jean-Claude Juncker. And warm words of reassurance for European Parliament President Martin Schulz. (SOUNDBITE) (English) GREEK PRIME MINISTER, ALEXIS TSIPRAS, SAYING: "The history of European Union is a history of disagreements, but in the end of the day, of compromises of agreements and we have the willingness to work in this direction." At the ECB in Frankfurt, though, a bitterly cold day. The question here: would ECB chief Mario Draghi freeze out a plea for debt leniency from Greek finance minister Yanis Varoufakis. (SOUNDBITE) (English) GREEK FINANCE MINISTER YANIS VAROUFAKIS SAYING: "We established an excellent line of communication ... I had the opportunity to present to him our government's utter and unwavering determination that it can't possibly be business as usual in Greece.'' He went on to say Greece could conclude debt talks with lenders in a 'short space of time'. Though the ECB has to decide whether to allow it some interim funding to do so. Greece needs 10 billion euros for upcoming debt payments. Its banks face possible crisis without ECB liquidity. FxPro Chief Economist Simon Smith. (SOUNDBITE) (English) FXPRO, CHIEF ECONOMIST, SIMON SMITH, SAYING: ''It is simply like having someone on life support. As soon as that life support in terms of the short term financing offered by the ECB is withdrawn, Greek banks just basically fail. Because they have seen such a run of deposits and are likely to again at this point in time." It leaves Draghi in an unenviable position. Turn the ECB life support off and the worst looms - or leave them on and in the eyes of Germany, reward spendthrift behaviour. Standard Chartered's Sarah Hewin. SOUNDBITE (English) Sarah Hewin, Senior Economist at Standard Chartered Bank, saying: ''There is pushback from Germany and I don't think we should underestimate the resistance of Germany to making changes without seeing significant reform plans and commitments from the Greek government.'' Varoufakis now heads for Berlin. And what might be an altogether pricklier meeting with his German counterpart, Wolfgang Schaeuble.

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Greek FM meets Draghi, Schaeuble next

Wednesday, February 04, 2015 - 02:26