PARIS (MNI) – Last-minute demands by Greek Prime Minister Lucas
Papademos to revise budget targets have cast new doubt on bailout
negotiations between Athens and its international public sector lenders,
the Financial Times reported Thursday, citing “people briefed on the
talks.”
The newspaper said that Papademos only informed his European
negotiating partners at 6 a.m. local time this morning that he wanted to
revise the budget targets for 2014 so that Greece would reach a primary
surplus of 4.5% by then.
The demand has forced the troika — inspectors from the European
Commission, European Central Bank and International Monetary Fund — to
recalculate their analysis of Greece’s debt sustainability, which is key
for determining how big the bailout needs to be.
An agreement with private sector creditors to cut the nominal value
of their Greek bonds in half is in turn dependent on completion of the
bailout agreement.
Eurozone finance ministers are scheduled to meet in Brussels at
17h00 GMT/12h00 ET today. They were expected to discuss and sign off on
the overall deal. However, it is now not certain that the troika’s debt
sustainability document will be finished in time for the meeting, the
Financial Times said.
Another major obstacle is the refusal, so far, of Antonis Samaras,
head of the conservative New Democracy Party, to sign a letter
committing himself to stick to the agreed austerity and reform program.
The troika insists that the deal cannot be consummated unless
Greece’s major party leaders all support it in writing. With elections
two months away, the inspectors want to ensure that there will be no
back-sliding by the new government. Samaras is considered a heavy
favorite to become the next prime minister.
The newspaper said European officials are concerned that they won’t
have Samaras’ signature by the start of the Eurogroup meeting this
evening.
–Paris Newsroom, +331-42-71-55-40; bwolfson@marketnews.com
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