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Greek Prime Minister Mr. Alexis Tsipras, has rejected the final proposal offered to him by European Union president Jean Clause Juncker last night.
However that does not mean that Greek deal is not coming.
Greek Prime Minister, will resume talks with EU leaders on Friday in an attempt to close the gap on differences and strike a deal that will not only unlock € 7.2 billion of remaining bailout tranche, will also free up another €10.5 billion, which was kept for recapitalization of banks. With this additional € 10.5 billion, Greece can pay off the dues of European Central Bank over the next two months.
Why a deal is coming for sure?
- A final draft by Euro zone creditors and bail out monitors including IMF has been the boldest step taken so far in this months' long negotiation process.
- A rejection was very much likely. An outright acceptance of the creditor's proposal would publicly mean that Syriza party has lost the negotiation and had to accept creditor's ultimatum. Which would make little sense to do. So the parties would come at final deal in the middle.
- Alexis Tsipras taking part in the negotiation directly means, deal is close, just because he would like to close the deal himself to impress the public.
As of now, Pension cuts and reforms along with increase in value added tax (VAT) is the main sticking point in the negotiation.
A deal or not, Greece is likely to make the IMF payment successfully on Friday and deal is expected by the weekend.
