Greece to continue bailout talks, aiming to finish before December 5

Tue Nov 22, 2016 | 1:42pm EST

Reuters

Greece will continue talks with international creditors on fiscal and labor reforms, aiming to wrap up the second review of its bailout program by early next month ahead of a euro zone finance ministers' meeting, government officials said on Tuesday.

Mission chiefs of the creditor institutions overseeing the program's implementation - the euro zone's ESM rescue fund, the European Central Bank, the International Monetary Fund and the European Commission - left Athens on Tuesday, leaving remaining issues to be resolved by technical staff and via teleconference.



Germany's Sueddeutsche Zeitung reported that the finance ministers of Germany, France, Italy, Spain and the Netherlands planned to meet in Berlin on Friday with IMF officials for talks on Greece's debt crisis, ahead of a euro zone ministers' meeting on Dec. 5 to discuss short-term debt relief for Greece.

Government spokesman Dimitris Tzanakopoulos told reporters: There is potential for a political deal by Dec. 5... but it is clear that strong political will is required from all sides".

He said Athens could not compromise on labor reforms or adopt new austerity measures.

Despite pre-election pledges to end austerity, Prime Minister Alexis Tsipras signed up to a new bailout package with conditions in July last year, the third since the crisis broke out in 2010.

Athens now wants a swift conclusion of its second assessment to qualify for more debt relief and inclusion in the ECB's bond-buying program early next year, which could pave the way for it to regain market access by 2018.

But disagreements on fiscal targets and unpopular labor reforms, including collective bargaining, a mechanism to set the minimum wage and giving companies more freedom to lay off workers, have clouded Greece's hopes.

Reforms in the energy sector were also among the sticking points in the talks.

Greece has to open up its natural gas market and reduce state-controlled utility Public Power Corp's (DEHr.AT) share of the electricity market from about 90 percent to below 50 percent by 2020.

There has at least been enough agreement with the creditors on next year's fiscal gap to enable the government to submit its final budget draft to parliament on Tuesday. It aims for a primary surplus of 2.0 percent of economic output in 2017.

(Reporting by Lefteris Papadimas; Editing by Kevin Liffey)