June 8, 2015 / 12:42 PM / 5 years ago

Greek minister changes tone, but sticks to anti-austerity line

BERLIN (Reuters) - Greek Finance Minister Yanis Varoufakis struck a conciliatory note on Monday in a long battle over a cash-for-reforms deal, calling a meeting with his German counterpart Wolfgang Schaeuble in Berlin helpful.

Greek Finance Minister Yanis Varoufakis attends a discussion meeting of the Hans Boeckler Foundation in Berlin, Germany, June 8, 2015. REUTERS/Fabrizio Bensch

However, he continued to resist the painful austerity that Greece’s creditors say is necessary to steady its finances and enable further aid to be disbursed.

“If you continue to squeeze our population into misery, we will not be reformable ever,” Varoufakis said during a speech on “Greece’s future in the EU” in Berlin.

“This government has the capacity to convince the people, a capacity that the previous governments lacked, that we need to reform deeply. But not if we are asked to exact even further austerity reforms,” he said.

Athens and Brussels exchanged proposals last week in the hope of breaking an impasse that, if unresolved, could force Greece out of the euro zone, an event that could shake financial markets and even the global economy.

But Prime Minister Alexis Tsipras dismissed the proposal from Greece’s international lenders as “absurd”, prompting an angry response from European Commission President Jean-Claude Juncker over the weekend.

On Monday, German Chancellor Angela Merkel warned that time was running out for a deal that could keep Greece in the euro.

Varoufakis said he wished for a quick deal and urged Europe’s leaders to avert an accidental exit from the euro zone: “History would take it down as a failure of the political class of the EU,” he said.

Earlier, Varoufakis met with German Finance Minister Wolfgang Schaeuble, with whom he has repeatedly clashed in the past, and described the talks as “helpful” in finding a final solution, without giving details.

He said the talks took place in an “extremely friendly manner” and that both ministers had a common understanding of the problem.

A German finance ministry spokesman declined to comment on the meeting, adding both ministers had agreed confidentiality.

In an interview with German newspaper Der Tagesspiegel, however, Varoufakis criticized the latest proposal by Athens’ lenders as counterproductive.

“You only make such a proposal if you actually don’t want to reach an agreement at all,” Varoufakis said, according to interview excerpts published on Monday. He also repeated Athens’ call for debt restructuring.

On Sunday, Varoufakis called on German Chancellor Angela Merkel to give his country a “Speech of Hope”, to signal Europe was ready to end its demands for austerity, similar to that given to Germany at the end of World War Two.

Additional reporting by Matthias Sobolewski and Michael Nienaber; Editing by Ruth Pitchford and Robin Pomeroy

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