A meeting of Greek political leaders has been postponed for Sunday as there is still no agreement with the country’s creditors over painful new austerity measures, a Greek cabinet minister said Saturday.
“We are still at odds with the troika, mainly over their demands to slash salaries in the private sector. The talks [with the troika of creditors] will continue today and hopefully the prime minister will meet the leaders tomorrow. The meeting won’t take place today for sure,” the minister, who asked for anonymity, said.
Greek Finance Minister Evangelos Venizelos has been meeting with representatives of the so-called troika—the European Union, International Monetary Fund and European Central Bank—on and off for the past two weeks to reach agreement over a series of new cutbacks, including slashing the minimum monthly salary in the private sector from €750 to around €550.
Once consensus is reached, Prime Minister Lucas Papademos will call for a meeting of the three political leaders who support his government to seek backing for the new measures. That agreement, along with a separate deal still under discussion over a 50% write-down in the debt held by Greece’s private creditors, will allow the troika to give the green light for a €130 billion second bailout package to keep Greece from defaulting.
At the same time, finance ministers or senior representatives from the 17 countries sharing the euro will hold a conference call on Greece’s new loan, after 12 hours of talks between Mr. Venizelos and the troika ended late Friday.
The cabinet minister said the Greek side is expected to tell the euro zone that a further slashing of salaries would sink Greece deeper into recession and could spark social upheaval.
Demands for additional austerity measures on the order of €2 billion to make up for missed budget targets last year are also being discussed, along with cuts to the country’s public-sector work force, and a mammoth bank recapitalization plan. Many of those issues will face popular resistance as Greece prepares for early elections, mostly likely to take place in April.
(source: DowJones)
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