Pressure mounts on Greece for rescue deal by June 18

Greece on Friday said it needed to clinch a deal with its EU-IMF creditors by June 18 to avert a default on its debt, as pressure mounts on Athens to give in to tough reform demands.

One of Greece’s key creditors, the IMF, pulled its team out of negotiations on Thursday because of major differences, dampening earlier optimism from the Europeans that an agreement could be close.

But Eurogroup chief Jeroen Dijsselbloem warned that a deal could only be done if the IMF remained on board.

Underlining the growing frustration with Athens, a new poll showed a majority of Germans now want Greece out of the eurozone.

Greece and its creditors, which also includes the European Union and the European Central Bank, have been locked in negotiations for five months in a bid to unlock 7.2 billion euros in rescue funds.

But the creditors are demanding economic reforms, some of which the Greek government — which was elected on an anti-austerity promise — have refused to sign up to.

Time is now running out as the country needs to find 1.6 billion euros ($1.8 billion) to repay to the IMF by the end of the month, when its bailout programme also runs out, potentially leaving it exposed to defaulting on its debt.

A deal “will come about by June 18 or never”, Defence Minister Panos Kammenos said in an interview with Mega channel.

Minister of State Alekos Flambouraris, a close associate of Prime Minister Alexis Tsipras, told state television ERT: “I hope (an agreement) comes very soon, on June 18, when the Eurogroup convenes.”

Athens stocks slumped four percent at open as optimism a day earlier for an imminent deal evaporated.

– ‘Major differences’ –

Kammenos — whose populist Independent Greeks party is the junior government coalition partner and is not involved in the talks — said Friday Greece would not meet its repayment to the IMF if the talks founder.

“If a solution is not found by the end of the month, we will not pay the IMF,” he said.

The IMF had pulled its team out of talks in Brussels on Thursday, with its spokesman Gerry Rice saying: “There are still major differences between us in most key areas.”

“There has been no progress in narrowing these differences recently. Thus we are well away from an agreement,” he said, adding that the agency nevertheless “remains engaged”.

In The Hague, Dijsselbloem told reporters that it was “unimaginable” to do a deal with Greece without the IMF’s involvement.

“If the IMF walks out –-which they won’t I’m sure, then part of the programme’s financing will be gone and then we no longer have a base,” he said, adding that the Fund’s involvement is indispensable.

– Germans want Greece out of eurozone –

With talks dragging on and no resolution in sight, a new poll for ZDF public television showed that Germans are no longer in favour of keeping Greece in the eurozone.

A narrow majority (51 percent) of Germans polled this week said they are now opposed to Greece still sharing the single currency. Six months earlier, only 33 percent were against.

European Commission chief Jean-Claude Juncker said Tsipras would have to face down his anti-austerity party, where a number of cadres have proposed early elections if forced to accept unpopular cuts.

“This is not a real party but a group of movements, tendencies, sentiments and resentments,” Juncker told France Culture radio.

European sources have told AFP that Greece and its creditors are debating a possible extension of the current eurozone bailout programme, which expires at the end of June, until March 2016.

The extension would be the third for Greece since last year and align it with the end of the IMF’s own bailout agreement with Athens, which has run in tandem with the EU and ECB programme.

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