Tags: EU | IMF | Greece

EU, IMF Officials Extend Talks With Greece

Monday, 22 Nov 2010 07:41 AM

A European and International Monetary Fund delegation held extended talks with Greek officials Monday on the flow of rescue loans to the debt-ridden country, citing "technical reasons."

Greece dodged bankruptcy this year due to a 110 billion euro ($150 billion) loan package from its European Union partners and the IMF, released in quarterly slices conditional on its implementation of reforms.

So far, the Socialist government has cut pensions and salaries, hiked taxes and pledged to overhaul the gargantuan, ineffective public sector.

An IMF press release said the one-day extension of the talks, initially scheduled to end Monday, was due to technical reasons, also cited by Greek officials, but did not expand. Greek media reports attributed the delay to disagreements over labor market reforms.

But Finance Minister George Papaconstantinou denied that there was any hitch and said the talks were focusing on structural reforms, including the labor market and loss-making state-run enterprises.

"Each time we engage in negotiations, which are always difficult and from which we achieve the best possible result," he said during a meeting with President Karolos Papoulias.

Greece is widely expected to receive the third tranche of loans, worth 9 billion euros ($12 billion), in January, following formal approval next month. The country has already got 29 billion euros ($39.6 billion) since the bailout deal in May, and IMF managing director Dominique Strauss-Kahn insisted last week that the deficit-busting effort was on track.

Athens has pledged to cut its bloated budget deficit by another 5 billion euros ($6.8 billion) next year, through higher consumer taxes and health and defense cuts.

The austerity measures have angered unions and triggered a series of strikes — which, despite the initial impetus, fizzled as Greeks became increasingly resigned to the hopelessness of the situation.

Mounds of rubbish have piled up on the streets of Athens, as a strike by municipal employees against wage cuts and planned layoffs of contract workers entered its fourth day Monday.

A 24-hour seamen's strike is set to stop ferry sailings Tuesday, while state hospital doctors have said they will treat outpatients for free all week to protest health cuts.

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