Greece steps up debt talks as cash reserves dry up
(Reuters) – Greece stepped up diplomacy with euro zone partners on Tuesday to try to avert a potentially catastrophic funding crunch this month, when it must make a big debt repayment to the IMF as cash reserves dry up.
Ministers were traveling to Frankfurt, Brussels and Paris to plead for a loosening of the financial stranglehold on Athens after leftist Prime Minister Alexis Tsipras spoke by telephone to German Chancellor Angela Merkel, Europe’s pre-eminent leader.
“They discussed the course of the negotiations in Brussels and exchanged views on the issues of Greece’s deal with its lenders,” a Greek government official said of the call on Monday night, without elaborating.
Intensive talks continued with the International Monetary Fund, European Commission and European Central Bank on a cash-for-reform deal but there was no sign of a breakthrough on key differences over pensions, labor reform and the minimum wage.
In a goodwill gesture, a senior privatization official said Athens was ready to finalize a 1.2 billion euro deal with German operator Fraport to run regional airports and to reopen bidding for a majority stake in the port of Piraeus.
European Economics Commissioner Pierre Moscovici said the aim was for euro zone finance ministers to be able to officially register “strong progress” in the negotiations when they meet next Monday but did not suggest a deal was possible by then.
The political uncertainty prompted the Commission to slash its forecast for 2015 Greek economic growth to 0.5 percent from 2.5 percent just three months ago. It also cut its estimate for Greece’s primary budget surplus before debt service.
“The fact that negotiations are still going on without having been concluded after more than 3-1/2 months, all that has an impact on expectations for growth and public finances in Greece,” Moscovici told a news conference.
