Tsipras asks European Union for a new bailout program

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ATHENS. KAZINFORM - Greece asked for a new bailout program from the euro region hours before its existing aid agreement expires and pushes the nation toward a financial precipice, according to Bloomberg.

Prime Minister Alexis Tsipras made the request to the European Stability Mechanism to cover all the country's financial needs for the next two years, along with a debt-restructuring plan, his office said. Dutch Finance Minister Jeroen Dijsselbloem, who heads the group of euro-region counterparts that had been in negotiations with Greece, said it will be considered later on Tuesday. On the second day of capital controls that shut the country's banks, the government said it will continue negotiations seeking a "viable agreement" within the euro area. The proposal didn't include any of the economic-reform measures European negotiators had sought for months. The move is the latest attempt by Greece to force the hand of its creditors after five months of talks dramatically broke down over the weekend. Tsipras called a surprise referendum for July 5 on the latest austerity measures, which are tied to the release of more rescue money. European leaders said it's ultimately a vote on whether to stay in the euro. Another Tactic? Tsipras's request for what would be Greece's third bailout in a little over five years, "strikes me as just another brinkmanship tactic," said Ben May, lead euro-zone economist at Oxford Economics in London. "It could arguably be the starting point for bringing Greece back from the brink, but it's going to be a pretty bumpy ride for sure." The euro pared its decline after the news of Greece's request, and traded 0.6 percent weaker at $1.1182 as of 3:25 p.m. in London. It was as low as $1.1134. Greece's government said it will miss a payment to the International Monetary Fund today and the country is preparing to exit the protection of Europe's bailout regime at midnight. A spokesman for German Chancellor Angela Merkel pointed to her comments earlier today, before the Greek request was made, noting that the current bailout expires tonight and there were no "relevant indications" otherwise. More Twists The latest twists are unlikely to be the last. German Finance Minister Wolfgang Schaeuble told lawmakers in Berlin that Greece would stay in the euro for the time being even if Greek voters reject austerity in the referendum, according to three people present. "This week is going to be very psychologically tense, very emotional," said Othon Anastasakis, a professor of European politics at the University of Oxford. "There are going to be various arguments from both sides." Call it a default, or call it "in arrears," Greece is set to miss a payment of 1.6 billion euros to the International Monetary Fund, due in Washington at 6 p.m. today. As Greeks struggled to live with a second day of capital controls and empty ATMs, the government and its creditors seemed unable to end their brinkmanship. Greek Prime Minister Alexis Tsipras this morning sought a two-year bailout from the European Stability Mechanism, the European Union's rescue fund. Tsipras earlier baited his creditors by telling a crowd of supporters in Athens that EU leaders wouldn't dare kick Greece out of the euro area or the EU itself because the cost to them would be "enormous." Greek Deputy Foreign Minister Euclid Tsakalotos told Bloomberg TV that he was waiting for a proposal from the creditors that would "overcome the fear of Grexit." Improbably, the left-wing radicals running Greece still expect the institutions they snubbed (by calling for a referendum on the creditors' most recent proposal) to take fright and cave - though markets today showed little concern about Grexit. Last night, Tsipras called European Commission President Jean-Claude Juncker to discuss a possible deal. Juncker, according to spokesman Margaritis Schinas, asked for a "move" from the Greek government by midnight last night, but no such submission came. Now, the Guardian in London and Bild in Berlin are reporting that Tsipras could fly to Brussels for last-minute talks, but it's hard to imagine the Europeans making any concessions now. It makes more sense to wait for the referendum, and suffer the indignity of having an EU member miss an IMF payment for the first time. Barring a surprise, last-ditch, short-term deal, Greece will default at midnight Brussels time.

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