Greece digs in for tough talks with lenders
By Lefteris Papadimas
ATHENS (Reuters) - Greece acknowledged on Monday it was having trouble persuading its foreign lenders to accept a plan to save nearly 12 billion euros over the next two years, essential to unlocking the aid payments the country needs in order to avoid bankruptcy.
Hopes that Greece, now in its fifth straight year of recession, might get a quick green light on the package were dashed when inspectors rejected part of it after bilateral talks resumed on Sunday.
There appeared to be little progress at a second round of talks on Monday between Prime Minister Antonis Samaras and the 'troika' of inspectors from the European Commission, the European Central Bank and the International Monetary Fund.
"It is a difficult discussion," Finance Minister Yannis Stournaras told reporters after the meeting. "We are trying to convince them on the soundness of our positions."
Troika officials rejected some of the proposed measures to cut public sector expenses and wanted a bolder plan to reduce the number of civil servants, a senior Greek official said.
"They insist on rejecting the measures that concern the restructuring of the state," the official said. "We insist that they accept them."
Slashing public sector jobs is a highly sensitive subject in Greece, where the constitution bars firing civil servants.
Athens' proposed austerity package includes a controversial plan for a "labor reserve" in which civil servants get reduced pay before being laid off, but the scheme only targets savings of 167 million euros over 2013 and 2014, a draft of the plan obtained by Reuters late last month showed. Continued...