Greek PM Tsipras: government will not compromise, but working for deal with rest of Europe

MarketsAssociated Press

Greece sounded a defiant note Tuesday, with Prime Minister Alexis Tsipras saying his country will not compromise in talks with its European creditors, but that it is working for an "honest and mutually beneficial agreement."

Tsipras' comments to his Syriza party lawmakers in parliament came a day after the collapse in negotiations between Greece and the rest of the 19-nation eurozone in Brussels over the new government's attempt to renegotiate its bailout.

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The failure has increased fears that Greece may be forced out of the eurozone, although investors seem to believe that the two sides will eventually reach an agreement.

Greece's eurozone partners have given the country until Friday to ask for an extension to the European part of the current bailout, which expires on Feb. 28. But Athens insists it cannot ask for the continuation of a program it considers to be wrong.

"Salvation will not come by extending the mistake," Tsipras told his lawmakers.

"We are not hurrying and we are not compromising," he said. "We are, however, working hard for an honorable and mutually beneficial agreement — an agreement without austerity and the bailout agreement that destroyed Greece in these past years."

Anything else, the prime minister said, "is not an agreement but a surrender that would complete the euthanasia of our country."

The bailout, which totals 240 billion euros, has kept Greece afloat since May 2010 but has come at the price of deep budget austerity measures. Tsipras' government was elected last month on a promise to renegotiate the deal, which he blames for wrecking the country's economy.

Investors and European policymakers are not panicking despite the breakdown in talks.

The Athens stock index fell by a modest 2.45 percent Tuesday, though Greece's government borrowing rates rose, a sign investors are more wary of a potential bankruptcy.