European economy and finance ministers continued their push for a compromise by private holders of Greek debt on Tuesday during the Ecofin meeting in Brussels, while the head of negotiators from the private sector, Charles Dallara, insisted that both sides would need to give ground and cooperate closely. “The current state of the negotiations with the private creditors is that we are a bit short of where we want to be,”
German Finance Minister Wolfgang Schaeuble told reporters after the Ecofin meeting. “As long as we do not have debt sustainability, there will not be a new program,” he added, effectively playing the Greek default card. Talks have stalled as the official side -- the Greek government, the eurozone and the International Monetary Fund -- are asking for a coupon of no more than 3.5 percent on the new bonds to complete the debt swap, while private bondholders are insisting on at least 4 percent. Dallara, managing director of the Institute of International Finance (IIF), said he was hopeful of finding «common ground» in the coming days on a Greek debt swap.
The IIF’s offer remains on the table, and all parties need to contribute to finding a solution in Greece, he said in a Bloomberg Television interview on Tuesday. "It’s important to all parties to recognize how much we have at stake here and that we work together cooperatively,» he told a press conference in Zurich, adding that he sees strains on the financial system extending around the globe. He stressed that all parties will need to honor the October 27 eurozone summit decision. The Greek government feels somewhat bolstered by the strong support it secured from its European peers, which was reflected in the statements Finance Minister Evangelos Venizelos made in the afternoon.
"In our effort we have the active support of the troika, the European Financial Stability Facility and of important European governments and we can reach a mutually beneficial solution that will fully implement all the parameters of the European Council decision in October,» read an official Venizelos statement.