Brussels, le 29/10/2012 (Agence Europe) - Greek finance minister Yannis Stournaras hopes to reach broad agreement with Greece's lenders on most of the savings to be decided in order to allow the disbursement of a new instalment of financial aid at the special Eurogroup videoconference scheduled for Wednesday 31 October. He is planning to present his draft budget for 2013 to the Greek parliament that same day, despite the fact that a party in the coalition government, moderate left Dimar, says it will refuse to back some labour market reforms that it feels are over-intrusive. It is reported that a new Eurogroup meeting will take place o n Monday 8 November ahead of the conclusive talks on Monday 12 November.
European sources admitted on Monday 29 October that nobody really knows at this stage what the eurozone ministers are likely to decide on Wednesday, and technical meetings will be taking place on Tuesday at the Council of Ministers' euro group.
The talks are expected to be about the long-term viability of Greek debt. In response to reports in German magazine Der Spiegel that the troika of lenders (the European Commission, the European Central Bank and the International Monetary Fund) is considering a write-down of Greek debt to be borne by public lenders, Berlin categorically rejected such a move. A German government spokesman said that it was out of the question for public lenders to absorb further losses on Greek bonds, along the lines of the write-down for private lenders that took place in March 2012. Ewald Nowotny of the ECB Executive Board said the IMF would continue to demand reimbursement of the bonds it holds because otherwise it would amount to an indirect payment to a country, which is outlawed by the EU treaties. Another option, which Germany would go along with, would be to help Greece buy back some of its bonds at a discount.
After a meeting on Monday between Stournaras and the head of the Greek Bank Union, Georgios Zanias, the Greek government ruled out the option of exchanging Greek bonds owned by banks for shares in the European Stability Mechanism, the eurozone's bailout fund. Most of the next instalment of aid, €31.5 billion, will be used to bail out Greek banks. The package has been delayed due to slow progress in the talks between Greece and the troika. (EL/transl.fl)