‘A magic wand cannot be waved’ to make Greek debt disappear

Minister of State at the Department of Finance Simon Harris has said a “magic wand” cannot be waved to make Greek debt disappear.

Mr Harris said said Ireland was showing solidarity with Greece but also with the "European project and with the rules of the eurozone".

He said the Greek people had recently elected a Government that wants to renegotiate its debt and remain in the euro.

“Remaining in the euro means you can’t take unilateral action. The Greek Government have already accepted that. It means that you must sit down with your partners, you must talk you must negotiate. And that is the reality of what’s happening,” Mr Harris said.

“There is no such thing as free money though. There is no such thing as being able to wave a magic wand and make debt disappear.”

He said he hoped agreement with Greece could be found.

Earlier Minister for Public Expenditure and Reform Brendan Howlin said he hopes Greece will strike a deal with the European authorities in the coming days. He insisted the Government was very supportive of Greece.

“We want Greece to succeed. We want Greece to remain in the euro. But it has to be done obviously within the framework of the laws that govern the euro,” he said.

Mr Howlin said it was disappointing a deal was not struck yesterday.

He said he understood the Greeks had not presented a technical paper with an alternative detailed plan to the European authorities.

“Time is running out. So it’s not a matter of support or sympathy or empathy. There’s huge support for the people of Greece because their economic plight is real.

“It’s close to now an economic emergency for the people of Greece.

“Thankfully we’ve moved well away from that position in Ireland because of the hard work of the Irish people.

“I’m still hopeful that a deal will be struck that will give relief to the people of Greece in the coming days.”

Talks between Greece and its international creditors disintegrated yesterday when Athens rejected a proposal to request a six-month extension of its international bailout as “ totally unacceptable”.

Despite a weekend of intensive talks between the troika and Greek officials in Athens the second eurogroup meeting in five days finished abruptly yesterday after Greece refused to countenance a draft communiqué proposed by the European Commission and the eurogroup of euro zone finance ministers.

Greek Finance Minister Yanis Varoufakis though looked to play down the situation as a temporary setback: "I have no doubt that within the next 48 hours Europe is going to come together and we shall find the phrasing that is necessary."

The euro edged down on Tuesday after the collapse in talks to secure a new debt deal for Greece kept investors guessing about the next chapter.

The breakdown in talks between Athens and its European partners raised doubts about Greece’s future in the euro zone.

Greek stocks were in the red, although Italian and Spanish 10-year government bond yields rose just 3 basis points, amid hopes that a common ground can still be found in coming weeks before Greece runs out of money.