‘Grexit’ countdown begins as PM Passos Coelho keeps fingers crossed for a deal

Greece and the eurozone have until the end of the week to strike a deal and avoid a ‘Grexit’. Portuguese prime minister Pedro Passos Coelho is hopeful that an agreement can be reached, but says Portugal and the eurozone have to prepare for the worst case scenario.

“We are talking about a very serious and urgent situation. If an agreement isn’t reached by the end of the week, then both the Greek government and the eurozone have to prepare for the worst,” he said.

The PM pointed out that while a deal has yet to be struck after “over five months of negotiations”, he believes it is still possible as “no one has anything to gain” from Greece abandoning the eurozone.

Even if no deal is reached, the Portuguese PM says “measures will be taken to preserve the integrity of the eurozone and the euro”.

In fact, European Commission President Jean-Claude Junker has guaranteed a “Grexit scenario is prepared in detail” should negotiations fall through.

Portugal’s economy minister António Pires de Lima has admitted the Greek crisis will have consequences on the national economy, no matter the outcome of this week’s negotiations. Still, he stressed that “Portugal is not Greece” and is confident the country will pull through.

“Four years ago, few could tells us apart from Greece and today the situation is what it is,” he said, adding that the Portuguese people are “very relieved to be in a situation that sets us apart from the troubles and difficulties of Greece”.

Following the historic referendum that saw over 60% of the Greek population saying “no” to more austerity last weekend, the Greek government was reported to have put forward a request for a three-year bailout as we went to press on Wednesday afternoon (July 8).

According to a letter obtained by the Washington Post, Greece proposed to take steps on key issues such as “taxes and pension payouts” as early as next week. It also said it would take “additional actions” to “strengthen and modernise” its economy.

Whether this will be enough to convince European leaders to provide the much-needed money remains to be seen.

By MICHAEL BRUXO [email protected]

Photo: Prime Minister Pedro Passos Coelho addressing parliament during a debate on the “State of the Nation” on Wednesday this week