IMF quits Greek talks; EU tells Tsipras to stop gambling

Game over?

Representatives of the Eurozone's central banks stand next to a picture of former Greek prime minister and Governor of Bank of Greece Xenophon Zolotas during a tour at the Museum of the Bank of Greece in Athens June 11, 2015. The International Monetary Fund dramatically raised the stakes in Greece's stalled debt talks on Thursday, announcing that its delegation had broken off negotiations in Brussels and flown home because of major differences with Athens. [Photo/Agencies]

One official close to the negotiations also cautioned against excessive pessimism, saying the IMF team's departure represented a break in the talks rather than a breaking off.

IMF experts sit in the "Brussels Group" of technical officials which has been on the sidelines in recent days as the politicians bargained. This suggested there was little point in their staying in Brussels, although they appeared ready to return at short notice if need be.

However, European Council President Donald Tusk delivered an unprecedentedly forthright message to Greece's radical anti-austerity government after four months of bitter negotiations.

"There is no more time for gambling. The day is coming, I'm afraid, that someone says that the game is over," he told a news conference after chairing an EU-Latin America summit that was dominated by intense talks with Tsipras on the sidelines.

"It is very obvious that we need decisions, not negotiations," Tusk said, adding that Athens needed to be "more realistic".

Tsipras held two hours of talks with European Commission President Jean-Claude Juncker, but neither side reported any breakthrough. "Come in the torture room," Juncker told Tsipras at the start of their meeting.

EU officials later described the talks as a "last attempt" to reach a debt deal.

Asked about concerns for the process raised by the departure of IMF and Greek negotiators, an EU diplomat said: "If the process was working properly the president would not have had to have a meeting with Tsipras today."

Tsipras told reporters he had worked on bridging the remaining differences on fiscal and financing issues. "We are working to assure an agreement which will ensure that Greece will recover with social cohesion and viable public debts," he said.

Tusk's admonition reinforced warnings by German Bundesbank President Jens Weidmann and EU Economics Commissioner Pierre Moscovici that time was running out to avert a Greek state bankruptcy and possible exit from the euro zone.

Late-night talks between Tsipras and the leaders of Germany and France produced no breakthrough, although all sides said they had moved closer on the procedure leading to an agreement.

"At the end of the talks there was absolute unanimity that Greece will work intensively and full steam ahead ... in the coming days to solve all remaining issues," German Chancellor Angela Merkel said.

To clinch a deal, EU officials said Tsipras's government needed to offer alternative savings and tax measures to replace proposed pension cuts and tax rises he rejected as antisocial, to deliver a modest fiscal surplus before interest payments.

People familiar with the talks said the two sides have come closer to agreeing a primary surplus target but are still wide apart on how to achieve it, with EU and IMF experts doubting that measures touted by Greece can do the job.

Late on Thursday German newspaper Bild reported that the German government is holding "concrete consultations" on what to do in the case of a bankruptcy of the Greek state, citing several people familiar with the matter.

This includes discussions about introducing capital controls in Greece if the crisis-stricken country goes bankrupt, Bild said in an advance copy of an article due to be published on Friday. A spokesman for the German government could not immediately comment on the report.