/ 4 February 2012

Eurozone ministers to continue ‘tough’ Greece talks

Eurozone finance ministers were to confer by telephone on Saturday after 12 hours of talks in Athens failed to produce a breakthrough on a Greek bailout deal, the Greek finance minister said.

Evangelos Venizelos added that a planned meeting by eurozone ministers on Greece originally scheduled for Monday would now be held on Wednesday.

“I will participate in a Eurogroup telephone conference” to discuss details of a rescue deal for Greece worth €130-billion which officials have been trying to seal since October, Venizelos said in a statement.

The minister said “critical issues pertaining to the country’s future remained open” after 12 hours of “tough” negotiations Friday with the European Union, International Monetary Fund and European Central Bank.

The three organisations, which bailed out Greece in 2010 with an earlier loan, are demanding labour cost cuts which Greek unions are refusing to concede, fearing they will worsen an already deep recession.

Representatives of holders of Greek debt are also returning to Athens this weekend for more negotiations on a crucial writedown Greece needs to avoid sovereign default.

A spokesperson for the Institute of International Finance, the global banking organisation leading the debt writedown talks, said in an email to AFP that IIF chief Charles Dallara and Jean Lemierre, adviser to French bank BNP Paribas, were headed to the Greek capital to continue the talks.

Greece has been negotiating for months to obtain debt relief under the so-called Private Sector Initiative as a condition for receiving a second international bailout from the EU and the IMF, agreed in October.

Pressure is mounting for Greece to strike a deal with private creditors. Most experts say it needs to have an agreement by February 13. Athens faces debt repayments of €14.5-billion euros on March 20. — AFP