Eurogroup demands its reforms before it releases cash to Greece

The Eurogroup of finance minister meeting in Riga Latvia had harsh words for Greek Finance Minister Yanis Varoufakis as they refused his bid to find a shortcut to get badly need financial aid.

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Jeroen Dijsselbloem, the chair of the euro-zone finance ministers, ruled out any partial aid payment, such as Varoufakis has requested, in exchange for fewer and narrower reforms:“It was a very critical discussion and it showed a great sense of urgency around the room,” Dijsselbloem said at a press conference after the meeting. Asked if there was any chance of a partial disbursement, he said, “The answer can be very short: No.”Also, Dijsselbloem told reporters at the end of the Riga meeting: "I'll be quite frank - it was a very critical discussion. We had hoped to hear a positive result..we are still far from that."Varoufakis was severely criticized for not bringing forward and implementing the "reforms" demanded of creditors including to pensions and the labor market even though such changes are termed by the Greek government as "red lines" that cannot be crossed. Perhaps the government is intending to show the Greek public that any reform is impossible within the EU. However, there seems to be little or no planning by the government for a possible Grexit or exit from Greece. Given the situation, and the positions of each side, it is hardly surprising that no agreement was reached at the meeting in Riga Latvia yesterday. The discussion on Greece at the meeting lasted little more than an hour. Dijsselbloem made it crystal clear that no funds were forthcoming unless Greece delivered on the reforms demanded: "A comprehensive and detailed list of reforms is needed. A comprehensive deal is necessary before any disbursement can take place ... We are all aware that time is running out."He also warned that if there were no deal completed by the end of June, the 7.2 billion euros in the loan would no longer be available and that creditors would not talk about longer term funding until a full interim agreement was reached.

An anonymous person familiar with the talks said that the finance ministers described Varoufakis as behaving irresponsibly in the talks, and being a gambler, time-waster, and amateur. In spite of this, Varoufakis himself said the two sides were now "much closer together" and that Greece was intending to achieve a deal as soon as possible. The president of the European Central Bank(ECB), Mario Draghi, threatened to even increase the pressure on Greece and warned that ECB policy makers might review the conditions set for emergency funding of Greek banks. The council governing the regulations is said to meet as early as May 6.Some ministers accused Varoufakis of backtracking on commitments he had made and failing to understand the deep differences that divide the Greek government from the position of Greece's creditors. Many eurozone officials believe that without new funds, Greece could default on debt by the middle of May. However, no one seems to know for sure.

The finance ministers were angry that the Greek Prime Minister Alexis Tsipras had met with German Chancellor Angela Merkel on Thursday a day before their meeting in an attempt to get her to approve financial aid and bypass them. He also met with French President Francois Hollande as well. Merkel said that she is not prepared to override the controls requiring that the finance ministers approve any release of funds. Greek Finance Minister Varoufakis also irritates the finance ministers by sending contradictory messages and little detail about the Greek financial situation. Varoufakis described the Friday talks as "intense" and told reporters after the meeting: “The cost of no solution would be enormous, not only for us but also for all."

The situation is becoming so critical that some finance ministers including from Germany and Slovenia have said that the group is considering plans as to what should be done if no deal can be reached with Greece by the end of June when the present bailout loan expires but large Greek debt repayments become due over the summer.