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Today the creditors rejected the third consecutive proposal for agreement that the Greek government had submitted to them. The Greek media report that Athens had sent a seven-page document, three pages of which contained its proposals for budgetary measures and the other four a separate proposal for how to cover its financing requirements in the coming months.

According to a European official cited by the Greek daily Kathimerini, the creditors had rejected the proposed measures in the past and they are not leading to "constructive progress".

To learn more about the course of negotiations GRReporter turned to correspondent for the Greek STAR TV and Real News newspaper in Brussels Thanos Athanasiou, who is closely following the course of events and who presented them to Anastasia Balezdrova.

Mr. Athanasiou, why has another proposal of the Greek government been rejected?

The specific proposal is yet another of the proposals that have been presented over the past hours. As European Commission spokesman Margaritis Schinas said earlier, this proposal is under consideration. It is just a supplement to the main proposal of Athens, which consists of 47 pages.

First, let us clarify what we are talking about. What is happening between Athens and its creditors is the completion of the fifth monitoring of the bailout programme and Greece has to submit its proposals for voting by parliament as required by the programme to complete it. They are available to the public on the website of the Economic Department of the European Commission. We are talking about budgetary measures that will turn today's budget deficit into a surplus in the range of 1% of GDP. At present, what is separating us from that 1% of GDP is around 700 million euro. The reason for the creditors to be insistent is that they will not provide funding for other Greek deficits. After five years, during which the country received 240 billion euro from the bailout programme, the creditors are providing funds only to service its foreign debt.

I.e. they are adamant that they will not give more money to finance the salaries of civil servants or the requirements of the public sector. If the Greek government wants to spend money on them, it itself has to find it somewhere.

This situation is under consideration today. The Greek government wants not to cut costs but to increase taxes. The VAT increase is clearly a political decision on the part of Athens and it is not at all a requirement of the creditors. All they could ask Brussels to do is to reduce costs because it is the easiest solution. The creditors, however, do not require anything, because their goal is for budgetary measures to become the product of a political decision by the Greek government, i.e. for the government to demand that the measures be taken because only then will they produce results.

Taking just some measures is not enough. Brussels has called on the government to choose what it wants and it has chosen to increase VAT.

How would you comment on the different information on the same issues, which comes from the Greek government and the creditors?

This has happened over the past five years. Athens always disseminates meaningless things and the creditors announce things that have actually happened. It is not possible for 18 member states to agree on an issue and the Eurogroup President to express their common position, and for someone to state the opposite in Greece. It is not possible to say that Alexis Tsipras had not called Jean-Claude Juncker and for him to state that he had actually received a call to which he had not responded.

It is not possible to continue with this disinformation. It dates back to the first moment when Greece had to make budget cuts in 2009 and did not do so. The same happened with the government deficit, the data of the Greek Statistical Office, etc.

That is why I say that a lot of nonsense is talked in Athens. This propaganda started in 2009 with the beginning of the financial problems and it has continued ever since.

Greece did not implement the memorandum. It partially introduced some things in the wrong way, after strong pressure. Of course, this model was not successful. Unfortunately, Greece continually ignores its creditors. For example, Slovenia is a larger creditor to Greece per capita than Germany. Consequently, any of the Greek Prime Ministers should have called his Slovenian counterpart and thanked him for his support. Nobody has ever done something like that. No other Greek Prime Minister has spoken to the country's president Borut Pahor since George Papandreou talked with him for the last time.

Europe's population is 500 million people. In Greece, we are 10 million. Either we will understand, and adapt to, the wishes of the other 490 million or it will be over.

How do you think things will develop from now on?

I think the fifth monitoring of the bailout programme will finish and then there will be talks about something else. But because in Greece there is fear of terms such as "memorandum", "measures" which they call "reforms", "deficit", "budget", etc., the government aims to obtain an extension of the current second bailout until March 2016, when the programme of the International Monetary Fund expires, instead of doing the right thing, i.e. taking the necessary measures to obtain the 46 million euro and solving the problem. And this in the hope that Greece will then be able to obtain funds from the capital markets. What markets will finance a country that wants to have more civil servants than necessary and pay big salaries, and which does not have an organized pension system? In Greece, despite the miserable financial situation, the payment of high pensions in the public sector and of lump-sum benefits at retirement in the public sector continues as well as early retirement. And all this at the expense of those who are insured at the Social Security Institute IKA and who cannot at all respond to the cuts in their pensions. On top of that, they are being told that it is the result of pressure from creditors, which is not true of course. People in Greece do not even know that there is no lump-sum benefit at retirement in Belgium but there is a ceiling of 2,000 euro on all pensions. No one obtains a dime more than this amount, and there is no early retirement. Whenever you stop working, you cannot retire before the age of 62 years, and the retirement age will become 63 years after some time.

Europeans see what is happening in Greece and have clearly told Athens that if it wants to continue with the current policy it will have to find alone the required money to finance it.

Is there a plan to force the Greek government to carry out real reforms, not just to apply budgetary measures?

Unfortunately, there is no such plan. If there were one, it would already have been applied, for as stated by Professor Daniel Gross, who was a consultant to Jose Barroso, "It is impossible to send the riot forces to Greece. The government is doing what it considers good." It is balancing between the voters and the fear of bankruptcy. Because the real suspension of payments and exit from the euro zone would mean no money in ATMs, no food in supermarkets, no one selling or buying anything, all foreign investors would withdraw, people would be hungry and go out in the streets with arms in hand and everything else one could think of. Because when a country ends up in a total failure, nothing functions in it.

People are not aware of this and they are talking about introducing another currency, etc. Who will make this transition? Would it be the people who are not able to cope with simple issues? If the public administration had the capacity and the ability to make the transition to another currency, it would have been able to handle the situation so that it would not have to take this action. However, as the Greek governments over the past many years did not have the required governing skills, they unfortunately could not cope with the problems. The situation is tragic, but the Greek wants to be a civil servant, receive his or her salary and does not care about anything else. Therefore, Greece is left to the mercy of fate, unless it decides to change.

Is it realistic to expect news about the agreement tomorrow?

There will be no agreement tomorrow. Jean-Claude Juncker does not want to meet in private with Alexis Tsipras, so as not to create the impression of backing down. They will meet with Angela Merkel, Francois Hollande and probably someone else. Surely, there will be proposals and an agreement on Saturday or Sunday night, in the best possible case. To be precise, the Euro Working Group will have to consider this agreement, and they will sit in Bratislava on Monday to prepare the EU summit in Luxembourg on 28 June. This is the plan and the only way to strike a deal is for the Greek side to provide reliable and calculated suggestions.

What might follow if this does not happen?

Then "all bets would be off." The cards would be dealt out again and we will see. Of course, I do not know what this would mean to Greek banks because another deposit flight would follow. I do not think the system is so stable and therefore, the Bank of Greece would have to introduce capital controls.

Is there a probability of Grexit?

There are two options. One is for the Greek government to leave the euro zone alone because someone should take the decision on Grexit and the only one that is able to do so is the Greek government.

On the other hand, the introduction of restrictions on withdrawals from ATMs and the inability to pay salaries and pensions would cause a commotion that would hardly allow the government to continue to have its feet on the ground and be able to take such a decision. Obviously, there will be political events.

Therefore, I consider not paying salaries and pensions for several months and closing banks highly probable compared to Greece leaving the euro zone.

What would be the damage to the euro zone due to Grexit?

Its credibility would suffer but the consequences would be removed in a very short time. The European Central Bank is applying the quantitative easing programme worth 60 billion euro per month. This amount actually annuls the consequences of Grexit. As for credibility, the logic that "the black sheep is off the scheme" would certainly prevail. There would be some accusations against Greece, namely that Athens had corrected the statistical data on the state of the economy, etc. The world economy would perceive this as a positive sign of cleansing and a step in the right direction, and it would forget the "Greek issue" after a short while. And Greece would never return to the euro zone.

Do the creditors have different positions on some issues relating to the agreement with Greece?

Yes, there are differences that are not as essential as presented by the government propaganda in Greece. Whatever their differences, they are bound by the agreement that was presented in Berlin after "the meeting of the five." And it states that all have to agree. There is no simpler solution than this. Regardless of what the International Monetary Fund, the European Commission or the European Central Bank are saying, no one of the three partners will act to the detriment of the other. Once they have this common position, any discussion is pointless.

Are the creditors willing to agree to a restructuring of Greek sovereign debt and to what extent?

No, there is no such possibility. Assume that the European Commission and the International Monetary Fund are two companies. The shareholders of one company hold shares in the other. Could the meeting of the board of one company take a decision against the management board of the other, in view of the fact that these are the same people? Of course, it could not.

Is just cannot happen. These speculations are disseminated in Athens and they state that Greece will be able to save itself because creditors have differences with each other, etc. No, there will never be a Greek debt haircut. There is no reason to haircut it. According to the representatives of the European Commission, Greece is earning 8 billion euro a year from the loans it has taken out. Because if it obtained loans directly from financial markets, not at the higher interest rates of today but at the low interest rates of years ago, they would have cost it an extra 8 billion euro.

Moreover, the cost of public debt financing is not as high as claimed by Athens. It is about 3% of GDP per year, whereas the cost of servicing the public debt of Italy is now 4.5% of GDP. If Greece borrowed another 50 billion euro to repay its loans to the International Monetary Fund and to redeem the bonds of the European Central Bank, then the cost of servicing the Greek debt would have been below 1% of GDP. Incidentally, this was the proposal of Lazard consultants to the Greek Ministry of Finance, but also the conception of Wolfgang Schäuble’s appeal to his US counterpart Jack Lew for Washington to provide 50 billion euro to save Greece.

This means the price for the next 25 years is very low. Therefore, the rhetoric about how huge the debt is as well as the cost of servicing it is false dilemmas. The creditors are willing to continue to assist Greece to pay its loans at a very low cost but want it to carry out reforms in return, because if it failed to do so, it would need financial assistance again in 10 years.

What is the attitude towards Alexis Tsipras in Brussels following the denial on the part of Athens that Jean-Claude Juncker had refused to talk to him last Saturday?

The feeling is that he is following a different logic and that he has betrayed them, and that they are doing the right thing for Greece but the personal relations with Tsipras have ended.

And all this despite the fact that the support of Jean-Claude Juncker for him was significant even before the elections and the President of the European Commission thus risked provoking misunderstanding with regard to Prime Minister of the time Antonis Samaras.

Now all that is past. The Greek Prime Minister has lied three times about things relating to Juncker and therefore the personal relations between them have ended.