Greece?s eurozone partners have asked for greater political consensus on reforms, a more aggressive privatization strategy and further cuts as conditions for approval of the next instalment of the country?s 110-billion-euro bailout and the further discussion of the possibility of restructuring or reprofiling its debt.
European Union finance ministers are due to discuss the state of the Greek economy on Tuesday after Greece?s Finance Minister Giorgos Papaconstantinou endured a grilling from his eurozone counterparts on Monday.
Sources said that it was made clear to Papaconstantinou that the 12-million-euro June instalment is on the line if the government fails to speed up its efforts to cut public spending and to increase revenues.
The Eurogroup seemed unimpressed with Greece?s plans to save 26 billion euros by 2015 as it has been informed by EU and International Monetary Fund officials that 10 million euros worth of these measures are questionable.
Finance ministers asked for Greece to reduce its deficit to 17 billion euros this year and to set up a private agency to oversee the sale of state assets in order to raise revenues.
They also called for some kind of public commitment from the opposition parties, particularly New Democracy, to support the measures. Sources said the Prime Minister George Papandreou spoke to ND leader Antonis Samaras this week and the conservative politician made it clear he would support specific reforms but would not give the government carte blanche.
Luxembourg?s Prime Minister and the head of the Eurogroup, Jean-Claude Juncker, indicated that if Greece can make progress by the time the eurozone finance ministers meet again on June 20, Athens would receive its loan instalment and further talks would be held on the issue of debt restructuring.
?Measures, measures and measures first,? said Juncker. «A large restructuring is no option,» Juncker said following a meeting of euro-zone finance ministers. «I wouldn’t exclude in a definite way a kind of reprofiling.»