As government officials brace for an extremely tough week of talks with representatives of Greece?s foreign creditors, Prime Minister Lucas Papademos sought to strike a positive tone, stressing in an interview with CNBC television aired on Monday, that authorities would push through tough reforms and secure the country?s position in the eurozone.
Papademos rebuffed rumors about an impending Greek default, insisting that an exit from the eurozone and a possible return to the drachma ?is really not an option.?
The premier said he was positive about the outcome of talks on a debt swap deal and subsequent negotiations on a second bailout for Greece, noting that ?substantial progress? had been made and that the two processes will have been completed ?over the next two to three weeks.?
Papademos, who is to hold talks with the leaders of the three parties in his coalition government individually this week, emphasized that all parties were determined to ensure Greece remains in the eurozone. Still, the premier is expected to urge all political leaders to focus on reforms as officials from the European Commission, European Central Bank and International Monetary Fund, known as the troika, will expect to see progress. The troika?s ?technical? team is to arrive on Tuesday with the chiefs expected on Friday.
The head of the EU Task Force, Horst Reichenbach, is due to begin talks with government officials on Tuesday on accelerating reforms and increasing the absorption of EU subsidies.
Troika officials are expected to press the government to boost competitiveness by reducing the minimum wage and abolishing supplementary salaries paid at holidays.
In his interview with CNBC, Papademos also stressed the need for wage reforms. ?What you have to do is to improve competitiveness, which partly depends on wage moderation, an internal devaluation and a reduction of prices and wages,? the premier said.
But labor unions vehemently oppose such measures and have even objected to a possible compromise involving a freeze on wages.
A possible deal with unions would influence scheduled talks between Labor and Social Insurance Minister Giorgos Koutroumanis and troika officials next weekend.