Greece

The US has urged Athens and its eurozone creditors to strike a deal over Greece’s financial future, underlining international concern about the global economic fallout from a prolonged stand-off over the country’s bailout, the Financial Times reported. Jack Lew, US Treasury secretary, called on both sides to be “practical and pragmatic” in seeking to resolve their differences and warned that a prolonged confrontation risked destabilising the EU. The Obama administration has intervened regularly in the five-year-old eurozone crisis, particularly at its 2011-12 peak.

Hoping to defuse a standoff that has set Europe and financial markets on edge, Greek officials intend to propose a detailed compromise plan at an emergency meeting with creditors on Wednesday in Brussels, a finance ministry official here said on Monday. The plan will include the possibility of tapping part of a bailout loan disbursement of 7 billion euros, or $7.9 billion, that Athens had been saying it would reject, according to the official, who insisted on anonymity because the plans had not yet been made public, the International New York Times reported.

As pressure grows on Greece to reach a deal with its international creditors and avert fears that it will default on its huge debt, Prime Minister Alexis Tsipras said on Sunday that his government would not seek an extension of a stringent bailout program and would carry out its campaign pledges to roll back austerity, but gradually, the International New York Times reported. In laying out his government’s program in a speech before Parliament, Mr.

In a related story, The Wall Street Journal reported that the U.K. government is stepping up contingency planning to prepare for a possible Greek exit from the eurozone and the market instability such a move would create, U.K. Treasury chief George Osborne said on Sunday. A spokeswoman for the Treasury declined comment on the details of the contingency planning. The U.K. government has said the standoff between Greece’s new antiausterity government and the eurozone is increasing the risks to the global and U.K. economy.

As he raced between European capitals, Yanis Varoufakis, Greece’s flamboyant leftwing finance minister, would have enjoyed reading McKinsey & Co’s study this week on global debt “deleveraging” — or rather, the lack of it, the Financial Times reported. The consultancy’s 47-country survey highlighted how indebtedness has increased much faster than economic growth since 2007, and argued for “fresh approaches” to reduce the dangers of future financial crises. To Germany’s particular horror, that was just what Mr Varoufakis is proposing for Greece’s debt mountain.

The eurozone’s monetary policy makers have tightened Greek lenders’ access to cheap liquidity, banning the use of the country’s debt as collateral for the European Central Bank’s cash weeks before a limit was expected to come into force, the Financial Times reported. The ECB’s governing council — composed of the heads of the eurozone’s national central banks and the top six officials on the central bank’s executive board, including Mario Draghi, the bank president — made the decision on Wednesday.

The professor of economic theory is being given a crash course in economic reality, The Wall Street Journal reported. In the past week, Yanis Varoufakis has had to perform a number of U-turns in his capacity as Greece’s new finance minister. His party, Syriza, told voters it would demand a debt reduction; now Mr. Varoufakis says it will settle for a debt restructuring. Syriza said it would end austerity; Mr. Varoufakis now says he will run a primary budget surplus even if that means dropping other commitments in the party’s campaign manifesto. Last week, Mr.

The European Central Bank is resisting a key element of the Greek government’s new rescue plan, potentially leaving Athens with no source of outside funding when its international bailout expires at the end of the month, the Financial Times reported. Yanis Varoufakis, Greek finance minister, had proposed to European officials that Athens raise €10bn by issuing short-term Treasury bills as “bridge financing” to tide the country over for the next three months while a new bailout is agreed with its eurozone partners. But the ECB is unwilling to approve the debt sale.

Much hangs on the interpretation of a word, and in the case of Greece and the euro zone that word is: insolvent, Reuters reported in a commentary. New Greek finance minister Yanis Varoufakis has been unusually frank, likening his country’s case to that of a jobless person being advised to take out advances on her credit card to pay the mortgage. “Would you advise them that they should continue to take these tranches of loans from the credit card in order to deal with what is essentially an insolvency problem?” Varoufakis said days after taking office under the new Syriza-party-led coalition.

Greece’s radical new government revealed proposals on Monday for ending the confrontation with its creditors by swapping outstanding debt for new growth-linked bonds, running a permanent budget surplus and targeting wealthy tax-evaders. Yanis Varoufakis, the new finance minister, outlined the plan in the wake of a dramatic week in which the government’s first moves rattled its eurozone partners and rekindled fears about the country’s chances of staying in the currency union.