Athens awaits EU verdict on aid

Officials in Brussels refuse to give details of possible rescue package as ministers argue about conditions

Finance Minister Giorgos Papaconstantinou yesterday joined his eurozone counterparts for talks in Brussels on a possible financial rescue package for Greece but no details of such a plan had been revealed by late last night, even though senior European Union officials made encouraging comments.

Comments made by European Commissioner for Monetary Affairs Olli Rehn ahead of last night’s meeting were upbeat though rather vague. “The Commission is ready to table a proposal for a European framework of coordinated and conditional assistance,” he said. “I would expect that Europe would endorse the Commission’s assessment of Greece’s bold set of measures,” Rehn said in reference to salary cuts and tax increases voted through the Greek Parliament last week.

Jean-Claude Juncker, the prime minister of Luxembourg and the Eurogroup chairman, also appeared positive. “We will discuss several options this evening... to find a solution if one is needed,” Juncker said.

But, according to sources, the finance ministers of the 16 countries that use the euro disagreed late into the night about the form of support Greece should receive but also the conditions on which this support should depend.

Dutch Finance Minister Jan Kees de Jager stressed that any help for Greece would be dependent on tough conditions of the kind that the International Monetary Fund includes in its rescue packages. “This is not a bailout,” he said.

The eurozone ministers were expected to discuss the possibility of providing loan guarantees or bilateral loans to help Greece refinance its debt but, despite widespread speculation about the level of such loans, officials appeared reluctant to provide a figure. Rumors put the figure at around 20 or 25 billion euros, half of what Greece needs to borrow this year.

In Athens, the secretary-general of the Organization for Economic Cooperation and Development (OECD), Angel Gurria, told Kathimerini that Brussels should give the Greek government “a clear and strong message of support.” Following talks with Prime Minister George Papandreou, Gurria described the government’s package of austerity measures as “robust and ambitious.” The OECD chief also noted that Greece should not rule out a possible appeal to the IMF. In comments to Reuters later yesterday, Gurria was more explicit, saying that EU ministers should offer Greece “something markets will understand and something which will allow Greece to reduce the cost of its borrowing.”