Grexit ‘no drama’ for EU, says French finance minister

Greece exiting the EU would be “no drama” for the rest of the union, says Michel Sapin, French finance minister, as world leaders at the G7 summit urged Greece to reform.

Sapin, who had previously been considered an ally of the Greek government, said: “It would be no drama for us to see Greece leaving the euro. It would not be serious from a financial or economic point of view,” CityAM reports.

His comments came as both President Barack Obama and German chancellor Angela Merkel urged the Greek government to accept reforms and avoid defaulting on their debt. 

Speaking at the G7 summit, Obama told Greek prime minister Alexis Tsipras to accept deeper cuts. “The Greeks are going to have to follow through and make some tough political choices that will be good for them long-term,” he said.

Tsipras appeared to lose another supporter, as EU boss Jean-Claude Juncker bemoaned the Greek premier missing multiple deadlines to present his alternative options for reform. He said he was promised the plan on Thursday but had failed to receive it by Sunday. 

The sticking points in the reform are adjustments to the country’s pension system and labour market reforms. Creditors want Greece to make cuts to its pension system, but this goes against election pledges made by Tsipras when his party came into power.

Creditors also want changes in the labour market to collective-bargaining rules and the minimum wage, which both sides have yet to agree on.

The deadline for Greece’s debt is looming, with the end of June being crunch time for much of the outstanding payments. Total outstanding debt stands at 180 per cent of GDP currently.