Greece: debt inspectors delay labour talks - Metro US

Greece: debt inspectors delay labour talks

ATHENS, Greece – International debt inspectors have delayed a meeting with the Greek government to discuss ways of reducing employment costs — a key sticking point in negotiations between the struggling eurozone country and its rescue creditors.

The Labor Ministry said the inspectors from the European Union and International Monetary Fund have called off a meeting planned for Tuesday and will hold it later in the week.

Greece’s unions, employers and political parties have all opposed suggestions that employment costs could be cut by slashing the minimum wage and private sector pay.

Labour reforms are part of pressing negotiations between Greece and rescue creditors to finalize a second bailout loan agreement, worth €130 billion ($170 billion).

That deal is closely linked to ongoing talks with private creditors to slash €100 billion off Greece’s national debt in exchange for cash payments and new bonds with longer maturities.

Greek Prime Minister Lucas Papademos told reporters in Brussels on Tuesday that he hoped negotiations with private and rescue creditors would be finished this week.

“Completing negotiations requires agreement on certain difficult issues. The timeframe is tight,” Papademos said after a summit of EU leaders.

“But we are all totally focused on the goal of completing these negotiations with success by the end of the week.”

The country’s national debt exceeded €350 billion last year, and without the bond-swap deal would not be considered sustainable as Greek gross domestic product is set to slow to €215 billion in 2012, in a fourth year of recession, according to state budget figures.

Jean-Claude Juncker, the Luxembourg prime minister who chairs the group of eurozone finance officials, said Greece would be facing more pressure from other eurozone members to meet budget-cutting targets but, rejected German suggestions to appoint a budget commissioner with veto powers over Greek decisions.

“I do not see the need to appoint a budget commissioner only and specifically for Greece. But our Greek friends also must know that they are under increased surveillance,” Juncker told German’s public Deutschlandfunk radio.

“Everyone knows that Greece’s consolidation program is off track,” he said. “Greece must live up to its commitments.”

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