The 130 billion-euro bailout package aims to prevent a Greek debt default on March 20, when bond repayments come due.
Arriving at the talks, French Finance Minister Francois Baroin had said “all of the elements for an agreement” were in place.
Jean-Claude Juncker, prime minister of Luxembourg and chairman of the eurozone finance ministers’ group, said he hoped the talks would be “the final consultations.”
German Finance Minister Wolfgang Schaeuble also said he was “optimistic” a deal would be reached, adding, however, that “quite a bit of work” remained to be done.
After five straight years of recession, Greece now has a debt greater than 160 percent of its gross domestic product.
International Monetary Fund (IMF) chief Christine Lagarde praised the “considerable efforts” Greece had done so far to address the crisis.
The Greek parliament has approved a series of austerity measures worth 3.2 billion euros, along with reforms aimed at getting its economy back on track, as a precondition for the bailout.
But the austerity measures are deeply unpopular in Greece and have prompted an outbreak of violent street demonstrations in Athens.
There also are concerns among the richer eurozone countries about whether future governments in Athens would continue to enforce the austerity measures that are part of the deal for a second bailout package.
Germany has called for Greece to set up a separately managed account to ensure that it services its debt even if there is a future change of government.
Critics say that requirement would be an unprecedented intrusion into a sovereign state’s fiscal affairs.
Also at stake as a result of the February 20 vote in Brussels is the fate of the accord between Athens and its private creditors — private banks and financial institutions — that involves the unprecedented write-down of Greek debt.
Greek Finance Minister Evangelis Venizelos warned earlier in the day that haggling would go on “until the very last minute.”
“We are here ready to conclude today this long process on the new Greek program, and also we are ready to initiate the official procedure on the PSI (Private Sector Involvement),” Venizelos said. “I’m optimistic, but in any case we need a clear political approval from the Eurogroup.”
The so-called Private Sector Involvement talks are debt restructuring negotiations, under which private creditors would accept a cut of at least 50 percent of the 200 billion euros in Greek debt they hold, as well as considerably longer repayment schedules.
Greece’s debt totals some 350 billion euros.
Source Article from http://www.rferl.org/content/eurozone_ministers_start_greek_bailout/24490420.html
