After IMF Departure, EU Puts Ball Back In Greece's Court

European Commission President Jean-Claude Juncker said on Friday that stalled debt talks between Athens and its creditors would restart but put the ball firmly in the Greek government's court to come up with an acceptable deal.

Juncker spoke after the International Monetary Fund quit negotiations in Brussels on Thursday, and a European Union leader bluntly told Athens to stop "gambling" with its future.

Time is fast running out for Greece to strike a cash-for-reforms deal with its creditors and stave off a default at the end of June that could see it tumbling out of the euro zone.

But Prime Minister Alexis Tsipras is showing no signs of alarm. His first engagement after rushing home from Brussels on Thursday was an open air pop concert celebrating the revival of the ERT state TV station, closed exactly two years ago under cuts ordered by the country's EU and IMF lenders.

Both sides tried to keep hope alive on Friday. A senior minister and close adviser to Tsipras said he hoped for a deal on June 18, at a meeting of euro zone finance ministers.

Juncker also stressed the process was not yet over. "Negotiations will start again, first at a technical level, then a political one," he told French radio. "A deal is necessary in the coming days," adding: "The ball is in the Greek court."

Greece needs a deal to unlock aid or loosen curbs on how much it can borrow in short term debt before a 1.6 billion euro ($1.8 billion) repayment to the IMF falls due by the end of this month.

Renewed uncertainty sent Greece's top share index down 4 percent on Friday morning. The German tabloid Bild reported that the German government was holding "concrete consultations", including about introducing capital controls restricting bank withdrawals in Greece and transfers abroad should the country go bust.

DEBT ISSUE

Tsipras faces major problems in meeting the promises he made before his election in January. He has vowed to end the waves of austerity imposed by previous governments at the lenders' behest. But he also needs to keep the country in the euro zone: a poll this week showed an overwhelming 77.4 percent favored keeping the common currency.

But the creditors are demanding yet more austerity and refusing to release any aid until Athens backs down, raising the risk of default and a euro zone exit.

For all the warnings of dire consequences, Tsipras put on a show of calm confidence at the evening concert outside the ERT headquarters in an Athens suburb.

Still in the blue suit he wore at the Brussels talks, he was mobbed by supporters as he arrived at the party. "It's a celebration of democracy. It is not the government that reopened ERT but the struggles of the Greek people. Today we should all be happy and look to the future with optimism," he said.

Major sticking points in the talks remain. Athens has balked at measures such as curbing pension benefits and raising value-added tax, and pressed lenders for more help to attempt to reduce the debt burden. Its own delegation also flew home from Brussels on Thursday.

For a deal to work, EU officials said Tsipras's government needed to come up with new savings and tax measures to replace those that Athens finds unacceptable. People familiar with the talks said the two sides have come closer to agreeing a primary surplus target but cannot agree on how to achieve it.

Juncker said he had given Tsipras a set of propositions in discussions on Thursday evening, but it was not immediately clear how Greece would respond, or whether it would send counter proposals to take the talks forward.

"No matter what we do, if we don't start addressing the debt issue, there is no chance that the Greek economy kickstarts," said Alekos Flabouraris, a state minister. "And if the Greek economy doesn't kickstart, we cannot deal with unemployment, shops will close down."

Anger against the grinding austerity measures imposed on Greece has simmered in the capital Athens. A group of about 50 workers gathered outside the deputy labor minister's office on Friday, demanding jobs.

That followed a larger protest by the Communist-affiliated trade union PAME on Thursday night, thousands of whom gathered to protest in a central square.

Asked about the upcoming IMF payment, Deputy Finance Minister Dimitris Mardas told SKAI radio: "It is our job to be paying our obligations at the time when they are due."