Greece bankruptcy looming, Eurogroup president warns

Time is running out for Greece to reach a deal with bailout creditors and prevent the country going bankrupt, the eurozone's top official said Friday as he headed into discussions with his colleagues from the 19-country single currency zone.

Though he downplayed any expectations that a deal would be secured at the meeting in the Latvian capital of Riga, Jeroen Dijsselbloem says there's a "great sense of urgency" from all sides to get a deal done. He said it's particularly important for Athens that a deal is secured soon so the country can get the financial support it needs "to make sure there's enough money available to keep the government running."

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Greece had an end-of-April date to agree to more reforms in exchange for rescue money its creditors had set aside. Without the money, Greece faces potential bankruptcy and a possible exit from the euro, a development that many in global policymaking circles feel could damage the world's economic recovery.

I have almost no expectation today. Substance is missing, this is the crucial problem. Time is running out and we have no time for diplomatic or political chit-chat.- Peter Kazimir, Slovakia finance minister

Though Dijsselbloem noted that "April isn't over yet," he said the deadline was far more important for Athens than the eurogroup.

Slovakia's finance minister, Peter Kazimir, showed little optimism that a deal would be agreed in the coming days and even ventured that Athens has until the end of June. "The end of June is the most important," he said.

For weeks, the meeting in Riga was expected to be the one where Greece's immediate financial future would be sorted out. Greece's left-wing government, elected in January on a mandate to bring crippling austerity to an end, would present its reform plans to its creditors in the eurozone. If all worked out as planned, Greece would be handed the remaining money available in its bailout program — 7.2 billion euros ($7.7 billion US) — to pay off upcoming debts to its creditors in the eurozone and the International Monetary Fund.

Creditors have demanded reforms that include sweeping changes to pensions and labor rules. But the Greek government has ruled out many key demands, arguing it was elected to end the kind of stifling budget austerity that contributed to a 25 percent contraction in the economy. Its focus is geared far more on fighting corruption and increasing its tax take than more cuts.

After weeks of tortuous discussions that have yielded little besides distrust, Greek Finance Minister Yanis Varoufakis is not expected to present any reform plans at the meeting.

Though Varoufakis did not speak to reporters as he entered the meeting, he insisted in a blog post published Friday that the "current disagreements are not unbridgeable" and that there already is common ground, particularly on revamping the tax system and making pensions fit for purpose by, for example, limiting early retirement.

"The Greek government wants a fiscal-consolidation path that makes sense, and we want reforms that all sides believe are important," Varoufakis said. "Our task is to convince our partners that our undertakings are strategic, rather than tactical, and that our logic is sound. Their task is to let go of an approach that has failed."

Heading into the meeting, Slovakia's Kazimir showed his frustration at the lack of progress, saying he was "a little bit tired" by the failure of the Greek authorities to present a properly costed set of proposals that would help break the logjam.

"I have almost no expectation today," he said. "Substance is missing, this is the crucial problem. Time is running out and we have no time for diplomatic or political chit-chat."

Kazimir wasn't alone expressing his frustration. "I am already quite annoyed with this issue," said Austria's Johann Schelling.

The failure to agree a deal has ratcheted up expectations in the markets of a potential Greek debt default and a subsequent exit from the euro. However, the prevailing view in markets is a deal will be reached after much soul-searching and bickering — as in the past.

Many in the markets think that a deal could emerge on May 11, when eurozone finance ministers are scheduled to meet next.

"While the prospects of possible Greek default haven't receded, it would appear that the timing has been delayed once again as both sides try and come to a deal that they can somehow sell as a solution that will satisfy everybody," said Michael Hewson, chief market analyst at CMC Markets.