Germany has rejected Greece’s plan for a crucial loan extension, calling it “no substantial proposal for a solution”.
The office of the German finance minister Wolfgang Schauble issued the terse response, just hours after Greece formally lodged its bid for a six-month deal to effectively replace its bailout, due to expire at the end of the month.
German finance ministry spokesman Martin Jaeger added that it amounted to a request “for bridge financing without fulfilling the demands of the (bailout) programme”.
The country’s new anti-austerity government is seeking a compromise to break the deadlock with European creditors, especially Germany, as it runs the risk of running out of cash and defaulting on its debts without agreement.
It has ruled out the prospect of any deal under the terms of its previous rescue because of its mandate from the Greek people who swept the anti-austerity Syriza party to power last month.
The details of the Greek request were not made public but the Reuters news agency said it had seen a document which suggested Greece had watered down its previous demands.
The letter, purportedly written by Greek finance minister Yanis Varoufakis, pledged to honour all Greek debts and not take unilateral action that would undermine agreed fiscal targets.
The government of Alexis Tsipras blames the conditions attached to its bailout of hampering the country’s recovery and leading to a deterioration of living standards.
Unemployment remains at more than 25%.
