Greece crisis bailout talks delayed
Greece is set to continue talks with international authorities over cuts being demanded in exchange for crucial bailout funds
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| Lucas Papademos (right) put on a brave face on Sunday, saying limited progress was achieved |
As some of you are aware, Greece has been going through a major financial crisis which has resulted in a potential country-wide bailout. However, negotiations between coalition parties on the austerity measures, which broke down on Sunday, have been delayed until Tuesday.
Athens needs the 130bn euros (£108bn; $171bn) of funds and help from private lenders to avoid a debt default. French President Nicolas Sarkozy said time was running out for a deal.
Speaking after a meeting with German Chancellor Angela Merkel, President Sarkozy urged Greek political leaders to agree to reforms, saying the crisis had to be solved "once and for all".
"Greece's leaders have made commitments and they must respect them scrupulously," he told a press conference.
"Europe is a place where everyone has their rights and duties. Time is running out, it needs to be concluded, it needs to be signed." Athens faces loan repayments to private lenders of 14.4bn euros on 20 March which it currently cannot afford to pay.
A European Commission spokesman said Greece was already "beyond the deadline" to end the talks.
"A date is approaching, however, when - if there isn't a deal -
Greece faces bankruptcy”
Austerity Measures
Talks on Sunday between Greek PM Lucas Papademos and the leaders of his three-party coalition over new austerity measures ended without full agreement.
The measures include:
- Further government spending cuts equal to 1.5% of GDP
- Re-capitalisation of Greek banks - whilst retaining their independence
- Reducing labour costs, including a cut in the minimum wage and holiday bonuses
- Further civil service job cuts
- Cuts to the size of pension programmes
On Sunday, the prime minister's office said that some agreement had been reached in some areas. But there were disagreements over the size of job cuts, cuts to the minimum wage, pension cuts and the ending of a so-called 13th or 14th month's pay as a holiday bonus.
The talks between the parties had been expected to reconvene on Monday, with signs emerging of movement on some of the more contentious issues.
Government sources told the BBC's Athens correspondent, Mark Lowen, that there was the outline of an agreement on cutting the minimum wage, currently about 750 euros a month, by 20%. Holiday bonuses that had been under threat, would be kept, the sources suggested.
Mr Papademos will meet representatives of the European authorities and the International Monetary Fund later.
It is hoped that the text of a final agreement on reforms will be distributed to party leaders on Monday night or Tuesday morning, giving them time to consult with their MPs before meeting the prime minister to sign off on the deal.
Strikes
Unions and employers' groups have resisted pay cuts, with the two largest unions calling for a day-long strike on Tuesday.
Iannis Panagopoulos, leader of the GSEE private-sector union, was reported as saying proposed 20-30% cuts in private sector wages "chronicle a pending death".
Anti-austerity protests are also expected to take place on Monday evening. The discussions come as the EU's statistics office reported Greece's debt spiked to 159.1% of gross domestic product in the third quarter of 2011 - up from 138.8% a year earlier and 154.7% in the second quarter. Unless Greece promises to implement reforms, the eurozone ministers say Greece will not be able to go ahead with a plan to restructure its privately-held debt. Eurozone finance ministers had hoped to meet on Monday to finalise the bailout - Greece's second - but that meeting has been delayed. Greece has prepared a debt plan with private creditors to more than halve the value of Greek debt and in return receive new, 30-year bonds with an average interest rate of less than 4%. The restructuring is designed to help cut Greek debt to 120% of GDP by 2020, a level viewed as sustainable by some economists.
**courtesy of BBC news Business**
Scary times we live in. As long as there's no food scarcity and survival mode kicks in, we're still good.
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