Greece bargain still has ‘long way to go’

ATHENS - Agence France-Presse

Protesters, who oppose the planned gold mine in the area, clash with riot police in the village of Nees Skouries, Halkidiki peninsula in northern Greece. EPA photo

Talks between the Greek government and its international lenders on an austerity package to keep the country afloat have a “long way to go,” a government official has said.

“We still have a long way to go. We have not completed anything, we spoke in general terms,” the source said after talks between Finance Minister Yannis Stournaras and representatives of the so-called troika of the European Union, International Monetary Fund and European Central Bank.

A troika member said they were working “day and night” on the audit, which will determine whether debt-laden Greece has done enough to secure the release of a vital 31.5 billion euro ($39.9 billion) loan tranche. Athens has to finalize a new austerity program within days to save 11.5 billion euros in 2013 and 2014 but is pleading for “breathing space”, arguing that cutting spending too much too fast will only further depress the economy.

Another meeting, this time including Prime Minister Antonis Samaras, was scheduled for yesterday.

Samaras, party heads meet

Meanwhile, the heads of the three parties in the Greek coalition government met late Sunday with Samaras but reached no agreement on the proposed measures and a new meeting is now set for tomorrow.

“We have not finished the plan because the troika has not accepted all of the Greek proposals,” said the Socialist leader Evangelos Venizelos, adding that the differences were especially over the nature of the proposed cuts to pensions and social benefits.

The lenders also want to see Greece tackle fiscal fraud to increase the state’s revenue as well as speed up privatizations and pursue deregulation of the labour market, another top government official said.

The troika representatives will remain in Athens “for some time” and are expected to accompany the Greek delegation to an informal meeting of eurozone finance ministers in Nicosia on Friday, the government source said, adding that the atmosphere at Sunday’s meeting was “better than before”.

After the talks the IMF representative Poul Thomsen said, “It was a good meeting”, while Klaus Masuch from the ECB added: “We’re working day and night.”