Tonight's Eurogroup risks being a total car crash. Far from red lines evolving, North & South could not be further apart. *All 4 parts* of the package are at risk. People should not be under any illusions about how broken the politics are. Short thread, based on chats 1/

The problem with ESM (conditionality) is well known. But DE & NL now want recipient MS (IT, ES) to conduct an updated DSA. But for ESM to lend, debt has to be sustainable in medium term. It won't be unless there's 1) premature fiscal tightening; 2) debt restructuring. Good luck

The North is also proving reluctant to provide capital guarantees to SURE, EIB. They also want all references to "common issuance" or "solidarity funds" deleted from draft Eurogroup statement 3/

Of course @mariofcenteno wants a deal. Does he move ahead without ESM? Does he manage to craft a compromise over SURE & EIB? REGARDLESS of whatever he achieves, there will now be massive questions over ESM, SURE & EIB at the implementation phase 4/

One senior EU official tells me that the entire negotiation has been underpinned by a total lack of urgency, empathy & trust between North & South. Obvious when ministers take the floor, & in preparatory Washington-group conference calls 5/

Unlike other jurisdictions, where fiscal & mon pol authorities seek to co-ordinate & co-operate, parts of the EG seem to want to actively undermine good work of @ecb & @Lagarde. With ESM, SURE, EIB at risk - either now or at implementation phase, Coronabonds are obviously a ZERO

All officials I've spoken to this morning are totally exhausted, utterly depressed. Europe clearly has to do much better - or it will not be just its "cohesion" that is at risk ENDS