July 6, 2015 / 9:59 AM / 2 years ago

UPDATE 2-Italy urges compromise to keep Greece in euro zone

(Adds Economy Minister Padoan)

ROME, July 6 (Reuters) - Italy called on Monday for Greece and its creditors to resume negotiations with a greater willingness to compromise in order to resolve Greece’s debt crisis and ensure Athens is not pushed out of the euro zone.

The call from Sandro Gozi, Italy’s top EU affairs official, contrasted with remarks from northern European capitals which appear to have lost patience with Athens after Greeks rejected the lenders’ latest terms in a referendum on Sunday.

Gozi told Sky Italia television that talks had so far been “a dialogue of the deaf”, for which all sides bore responsibility.

“If everyone thinks they are totally right and the others are totally wrong we will not make progress,” he said. “We have to make an effort to understand the others’ point of view.”

Economy Minister Pier Carlo Padoan said later on Monday that all the euro zone countries would consider a new proposal, but he hoped for a new attitude from the Greek government.

Padoan said former Greek finance minister Yanis Varoufakis had always been “very pleasant”, but added: “Let’s be frank, four months have been wasted without making a significant step forward.” Varoufakis quit on Monday, to be replaced by bailout negotiator Euclid Tsakalotos.

Italy, with the euro zone’s second highest public debt after Greece‘s, is considered one of the countries most vulnerable to financial market turmoil if Athens should exit the euro.

Padoan, who met Prime Minister Matteo Renzi earlier on Monday to discuss the repercussions of the referendum, said Italy was “absolutely” not at risk from the Greek crisis.

Gozi’s comments appeared to indicate a shift in Italy’s position. Before the referendum, Renzi had blamed Greece for talks breaking down and said if they voted “no” in the referendum they would be opting to leave the euro.

“We have to work for Greece to remain in the euro zone,” said Gozi, who is seen as close to Renzi. “I don’t believe it is in the interests of anyone to push it into a no-man’s land.”

But with Renzi under fire from anti-euro opposition parties which criticise him for being too close to German Chancellor Angela Merkel, Gozi denied that Rome was shifting its position.

“Right from the start Renzi radically opposed the austerity policies of these past years and said it was an approach that had to be left behind,” he said. (Reporting by Gavin Jones and Isla Binnie; Editing by Crispian Balmer and Mark Trevelyan)

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