Greek, foreign officials start talks on common reform ground

Greece and its international creditors started talks on Friday on reforms needed to keep the country financed, increasing the possibility of a interim compromise deal between the euro zone and Athens at a ministerial meeting on Monday.

The talks between euro zone finance ministers and Greece on Monday are key, because they are the last moment for the new Greek government to ask for a technical extension of the current bailout program, which runs out on February 28.

Greece needs such an extension to ensure continued official financing at a time when market borrowing is too expensive for Athens and to be eligible for negotiations on more time to repay the euro zone loans already received.

But the left-wing government of Alexis Tsipras won elections in January on promises of ending the 240-billion euro bailout and the belt-tightening reforms that came with it and does not want to ask for an extension, even by a few months.

“There have been very good political debates…and now we need to get down to the hard facts, explaining what is in the (bailout reform) agreement and what are the quantified results of the new Greek government’s program,” a senior EU official close to the talks said.

“On Monday we expect a description of what are the overlaps between the two, and I expect them to be non-negligible, and what are the divergences,” the official said.

If Greece wanted to remove a certain reform from the list agreed under the bailout, it would have to propose in its place a measure that would have a similar fiscal effect, he said.

He was echoing comments made by European Commission President Jean-Claude Juncker after Tsipras presented his ideas to a summit of EU leaders in Brussels on Thursday.

The official noted that if Greece did not ask for a bailout extension on Monday, the program, with the financial cushion it provided, would expire and Athens would have to apply for a new, fully fledged bailout – the country’s third.

“It’s not crucial to extend. One could also agree to start discussions on a new program, That is a distinct possibility, I would not exclude it,» the official said.