By Michele Kambas and William James
NICOSIA/LONDON (Reuters) - Greek Prime Minister Alexis Tsipras ruled out seeking aid from Russia and said on Monday he would pursue a new debt agreement with European partners, taking a milder line after a tough first week although sparring partner Germany gave no ground.
Spurning neckties, Tsipras and his pugnacious finance minister Yanis Varoufakis are touring European capitals this week in a diplomatic offensive to replace Greece's bailout accord with the European Union, European Central Bank and International Monetary Fund, known as the "troika".
An interviewer who spoke to Varoufakis in London said the finance minister had promised that debt negotiations would yield a result soon. In excerpts, Varoufakis said it was time for action to stop Greece being a "festering wound" on Europe.
After a tumultuous first week during which the new left-leaning government made clear it intends to keep campaign promises to ditch the tough austerity conditions imposed under its existing bailout, the emphasis this week appears to be on maintaining that a new deal is still possible.
"We are in substantial negotiations with our partners in Europe and those that have lent to us. We have obligations towards them," Tsipras said at a news conference in Cyprus during his first foreign visit as prime minister.
"Right now, there are no other thoughts on the table," he said, when asked whether Greece would seek aid from Russia, which has suggested it could be willing to listen to a request for support from Athens.
The remarks on Russia could reassure EU partners shocked last week when the Tsipras government initially appeared to reject the bloc's consensus on economic sanctions against Moscow. Greece eventually signed up last Thursday to extending existing sanctions against Russia for six more months.
Greece, unable to borrow on the markets and facing pressure to extend the current support agreement when it expires on Feb. 28, is looking for a bridging deal to provide breathing space to propose a new debt arrangement.
It has so far met a tough line from European partners, above all Germany, whose Finance Minister Wolfgang Schaeuble told Reuters in an interview on Monday that Berlin would not accept any unilateral changes to Greece's debt programme.
"We want Greece to continue going down this successful path in the interests of Greece and the Greeks but we will not accept one-sided changes to the programme," he said at the Reuters Euro Zone Summit.
Tsipras repeated calls already made by his finance minister Varoufakis for a mechanism of inspections by experts from the "troika" overseeing Greek finances to be dismantled and replaced by direct negotiations between Athens, the EU and IMF.
"I believe that this would be a mature and necessary development for Europe," he said. Germany said "Nein".
"The German government sees no reason to scrap this mechanism of evaluation by the troika," Finance Ministry spokeswoman Christiane Wirtz said in Berlin.
To some degree, both sides are posturing ahead of what are certain to be difficult negotiations. The Greeks appear to be searching for more sympathetic ears first, before meeting the Germans.
Varoufakis, an outspoken economist who has likened EU austerity policies to "waterboarding", has been arriving for meetings with besuited European leaders in a rumpled black coat and untucked, open-collared shirt.
He began over the weekend in Paris, where the centre-left government is thought to be more sympathetic than others to the case for relaxing lending conditions.
French Finance Minister Michel Sapin said after meeting Varoufakis that Athens could not expect a straight debt write-off, but left the door open to other options that include giving Athens more time for repayment.
Varoufakis's next stop was in London on Monday, where he was due to meet about 100 banks and financial institutions. An organiser said one of the meetings had to be moved from a fancy London members' club, because Varoufakis wouldn't wear a tie.
A Greek government source said Varoufakis would tell the private sector investors they had nothing to worry about.
"We will be able to service the Greek debt on terms that will have no detrimental impact on, especially private, bond holders," said the source who spoke on condition of anonymity due to the sensitivity of the matter.
Varoufakis also met British officials, seeking more European allies, although Britain is not a euro zone member.
After meeting him, Britain's finance minister, George Osborne, called the stand-off between Greece and the euro zone "the greatest risk to the global economy".
"I urge the Greek finance minister to act responsibly but it's also important that the euro zone has a better plan for jobs and growth," Osborne said.
On Tuesday, Tsipras will meet Italy's Prime Minister Matteo Renzi, a young centre-left leader thought to be among those most sympathetic to calls for leniency. He sees European Commission President Jean-Claude Juncker and French President Francois Hollande on Wednesday. So far no date has been set for a meeting with German Chancellor Angela Merkel, although they will meet at a European summit on Feb. 12.
Exactly how much time Greece has to reach a deal with its creditors remains to be seen. In theory, there are only weeks left: once the bailout expires at the end of February, the European Central Bank could be obliged to pull the plug on funding for Greek banks. In practice, however, an alternative interim funding mechanism for the banks may be found.
After that, Greece has large debt payments due in March, although officials say it could have enough cash on hand to meet them, avoiding a crunch until later in the spring.
Despite German resistance, Tsipras said the tide of debate in Europe had been unexpectedly encouraging for Athens, with more and more backing for the idea of a change of direction.
"I never expected that there would be such strong forces helping the new government create a new framework and set a new course, not only about Greece but Europe as a whole, because Europe is in a crisis," he said.
(Reporting by Reuters bureaux; Writing by Peter Graff; Editing by Sonya Hepinstall and Philippa Fletcher)
