HomeNewsGreece, creditors piece together debt deal

Greece, creditors piece together debt deal

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Greece and its private creditors worked on stitching together the final bits of a complex debt swop agreement on Saturday, amid growing optimism a deal would be clinched in time to avert an unruly default.

After weeks of muddling through round after round of inconclusive talks, negotiations appeared to be in their final phase, though it was unclear if a preliminary deal could be secured in time for the European Union summit.

Greek officials and Charles Dallara, chief negotiator for banks and insurers, left Saturday’s negotiating session without making any comment. Earlier, Prime Minister Lucas Papademos said he expected the deal to be concluded within days.

Still, for Athens, progress on the debt swop front is at risk of being overshadowed by increasingly problematic talks with its foreign lenders, whose inspectors are in town demanding unpopular reforms that no politician wants to be linked to.

“Today will be another tough day,” said George Karatzaferis, leader of the far-right LAOS party, one of three parties in Papademos’s emergency coalition government. “We will see whether we can bear the burden that lies ahead.”

European paymaster Germany is pushing for Athens to relinquish control over its budget policy to European institutions as part of discussions over a second rescue package, a European source said.

With many Greeks blaming Germans for the austerity medicine their country has been forced to swallow, officials in Athens dismissed the idea as out of the question.

“There is no way we would accept such a thing,” a Greek government official said on condition of anonymity.

The official said a similar proposal had been made in the past by a Dutch minister without getting anywhere.
The European Commission, the executive arm of the 27-country bloc, said it wanted the Greek government to maintain autonomy.

“The commission is committed to further reinforcing its monitoring capacity and is currently developing its capacity on the ground,” said a spokesman.

“But executive tasks must remain the full responsibility of the Greek government, which is accountable before its citizens and its institutions. That responsibility lies on their shoulders and it must remain so.”

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