Greece still can’t make debt deal
Greek government talks on a new austerity package will continue next week, officials said on Thursday as demands by EU-IMF creditors for controversial cuts put pressure on the ruling coalition.
“(Another meeting) is possible on Wednesday,” socialist leader Evangelos Venizelos told reporters after a three-hour meeting with Prime Minister Antonis Samaras and third coalition partner, leftist leader Fotis Kouvelis.
Finance Minister Yannis Stournaras had previously noted that Greece was locked in a “very tough” negotiation with its creditors over a number of pending issues.
“There is agreement on a large part of the (austerity) package but there is still an open part,” the minister said.
Leaders from the eurozone and officials from the International Monetary Fund are insisting that the Greek government come up with convincing measures and act fast to implement them.
The EU and IMF are funding vital bailout help for Greece. But the country has fallen far behind in enacting structural reforms, and the IMF says the new package must include further pay cuts in the state sector.
A wide array of sectors from teachers and doctors to judges and army staff have staged protests against the planned cuts and a general strike has been called for September 26.
Ahead of the leaders’ meeting on Thursday, scuffles broke out near the prime minister’s office between riot police and protesting uniformed security staff.
On Wednesday, marathon negotiations with lenders managed to narrow down the measures needed to reach agreement to between two billion and three billion euros ($2.6-3.9 billion) out of an overall package worth some 11.5 billion euros.
But a finance ministry source on Thursday said Greece was resisting IMF pressure for new pay cuts in the civil service that come on top of salary reductions of between 25 and 40 percent sustained over the last two years. Conclusion of negotiations on extra austerity would unblock a 31.5-billion-euro instalment of rescue funding from the so-called ‘troika’ — the EU, IMF and the European Central Bank — which the country needs to stay afloat.
Eurozone finance ministers are meeting on October 8, ahead of an EU summit on October 18, and Venizelos said Greece would best be ready by then.
“My position is that we must go to the Eurogroup on October 8 with the measures already voted (into law),” the socialist coalition partner said.
According to local media reports, the coalition partners disagree on a proposal to raise the Greek retirement age to 67 from the current 65, a move that would provide sustainable savings to the satisfaction of the troika.
Both Greece’s government and opposition warn that a nation struggling under a third year of austerity, a five-year recession and record unemployment cannot sustain additional sacrifices.
“The troika must stop attacking Greek society,” leftist coalition partner Kouvelis said on Thursday.
“It must understand that this society has a certain tolerance level, and the way in which society operates has its limits,” he said.