Greece lets another deadline slip in bailout | business | Hindustan Times
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Greece lets another deadline slip in bailout

business Updated: Feb 07, 2012 00:45 IST
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Greece let yet another deadline slip on Monday for responding to painful terms for a new EU/IMF bailout as patience in Brussels wore thin over drawn-out negotiations among its feuding political leaders.

Failure to strike a deal to secure the €130 billion ($170 billion) rescue risks pushing Athens into a chaotic debt default which could threaten its future in the euro zone.

Panos Beglitis, spokesman of the PASOK socialist party, said on Sunday that leaders of the three parties backing technocrat Prime Minister Lucas Papademos' government had to give their responses in principle by noon.

However, a government official denied that the parties had been given an ultimatum to respond on Monday.

Asked whether the parties had to respond in time for a Euro Working Group meeting of finance ministry officials in Brussels, the Greek official said: "No, there is no deadline."

He said the entire Greek side had to agree terms of the rescue, which would be the second for Athens since 2010, with international lenders before the next meeting of the Eurogroup of euro zone finance ministers.

In Brussels, frustrated EU officials said Greece was already in "overtime" after failing to clinch an agreement at the weekend on a package incuding wage and pension reductions, job cuts and tougher tax enforcement measures.

"It will be very bad if there is no white smoke from Athens today," said a euro zone government source. "We have already missed deadlines. In order to prepare the fresh tranche of money and reschedule debt in the first half of March, a whole series of technical steps must be taken. We need a decision now to put the mechanism of rescheduling in place."

Beglitis said the deadline had merely slipped to Tuesday due to the changing timetable of euro zone meetings.