Long Troika Talks Stall Yet Again

Greek Finance Minister Yannis Stournaras (L) with the Troika

A week after saying it had a deal in hand, the Greek government now is admitting that negotiation with its international lenders have sputtered again over unresolved reforms and a disputed hole in the 2014 budget.

Envoys from the Troika of the European Union-International Monetary Fund-European Central Bank (EU-IMF-ECB) are pressing Greece over 153 undone structural reforms and want to know how the government intends to close a gap of as much as 2.4 billion euros ($3.3 billion) in this year’s budget – as well as another looming over the following two years.

A government spokesman insisted that progress was being made, repeating the same line given the last six months as the talks have stalled. Nearly non-stop talks have been going on the past few days including the Troika with Development Minister Costis Hatzidakis and Administration Reform Minister Kyriakos Mitsotakis.

But, the Athens News Agency (ANA) reported, he said, “We are at a point that a political decision must be taken until the Eurogroup meeting on March 10” the day when the finance chiefs from the 18 countries that use the euro, including Greece, will have their get-together and possibly decide whether to release a pending nine billion euro ($12.4 billion) installment.

Greece is surviving on the last vestiges of $325 billion in two bailouts that began in 2010 and run out this year and needs the mYoney to meet a 10 billion euro ($13.7 billion) bond payment.

There’s  a lot at stake as Prime Minister Antonis Samaras, whose coalition of his New Democracy Conservatives and PASOK Socialists face a severe challenge in the May elections for Greek municipalities and the European Parliament from the major opposition Coalition of the Radical Left (SYRIZA) doesn’t want to impose any more austerity measures.

He’s also said the country will have a 1.5 billion euro ($2.07) billion primary surplus and has vowed to give back 70 percent of it to those hit hardest by pay cuts, tax hikes and slashed pensions to stop the bleeding of disaffected voters from his government.

ANA said that at 3 a.m. on March 3 a minister it didn’t identify felt the two sides were getting closer after sorting through technical details but that “things are very tough” and that there is still hard work to be done before March 10.

Another minister called additional “thorns” in the negotiations, issues regarding three ministries, Administrative Reform (availability – layoffs), Health (non-prescription medicines) and Labour (changes in labor regime).

The meeting with the Troika started on March 2 at 8 p.m. after a small Cabinet meeting at the Finance Ministry led by finance chief Yannis Stournaras and including Mitsotakis, Hadzidakis, Labour Minister Yiannis Vroutsis, Health Minister Adonis Georgiadis and Justice Minister Charalambos Athanassiou.

An Administration Reforms Ministry top official said that, “We remain adamant to our positions. Nothing has closed yet, we will meet again. It will be hard to finish by Friday. If we who have a simple job can’t agree, you can imagine what it’s like for other issues.”

The Finance Ministry insisted there’s no disagreement over the budget although it was reported the Troika doesn’t want Samaras to distribute the surplus to punished workers, pensioners and the poor as its first priority is banks and investors.