Greece says it cannot accept ‘unviable’ debt solutions

Greek Finance Minister Yanis Varoufakis said his country has done everything it could to accommodate the “strange demands” made by its creditors, and was determined to remain part of the eurozone.

Demands for tax increases and pension cuts that Greece’s creditors are setting as conditions for the disbursement of financial aid are putting the country in an impossible position, Varoufakis told Irish national radio RTE on Friday.

“I am against increasing the corporate tax, but then again I am against raising the tax on hotels and against cutting the pensions of people who live below the poverty line,” he said.

“These issues are putting me and my government in an impossible position, having to make a bad choice among really hard, difficult bad choices.”

Varoufakis said Greece would not accept any solution to its debt crisis that it considered unviable.

A key meeting of eurozone finance ministers broke up without agreement on Greece’s rescue package on Thursday, intensifying doubts about whether Athens can pay the International Monetary Fund a debt worth about $1.8bn on June 30.

German Chancellor Angela Merkel said that a solution must be reached at another meeting set for Saturday.

An agreement on a drastic Greek tax and austerity reform package is necessary for creditors to unfreeze about $8.1bn in bailout money.

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Varoufakis’ comments came as Germany’s EU Commissioner Guenther Oettinger said on Friday that Greece’s exit from the eurozone will be inevitable if Athens and its lenders do not come up with a solution within the next five days.

“We will do everything up until the 30th so that the Greeks show they are prepared to reform,” Oettinger told Deutschlandfunk radio.

“A ‘Grexit’ is not our aim but would be unavoidable if there is no solution in the next five days,” he said, referring to the term used to describe Greece’s potential exit from the eurozone.

The continuing impasse highlights the difficulty eurozone countries have in keeping Greece afloat, with billions of euros having flown out of the country’s beleaguered banking sector in recent days and the European Central Bank having to inject emergency liquidity just to prevent the nation from going bankrupt.

A well-placed Greek official, who spoke on the condition of anonymity as he is not cleared to speak publicly about the negotiations, told Al Jazeera on Thursday that talks to were expected to drag on because creditors were “holding Tsipras hostage”.

“They are saying if you don’t agree, we are simply going to force you until you do,” the official said.