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Greece, Lenders to Discuss Bailout Provisions

  • VOA News

Managing Director of IMF Christine Lagarde (l) arrives with Dutch Finance Minister Jeroen Dijsselbloem for a meeting of eurogroup finance ministers in Brussels, Feb. 11, 2015.

Managing Director of IMF Christine Lagarde (l) arrives with Dutch Finance Minister Jeroen Dijsselbloem for a meeting of eurogroup finance ministers in Brussels, Feb. 11, 2015.

Greece and its international creditors agreed Thursday to launch technical discussions on the debt-ridden country's demand to cut its massive debt and ease the austerity measures the lenders imposed on Athens.

As he attended his first European Union summit in Brussels, Greece's new leftist Prime Minister Alexis Tsipras reached agreement for Greek officials to meet representatives of the eurozone, the European Central Bank and the International Monetary Fund.

Dutch Finance Minister Jeroen Dijsselbloem said the Friday meeting is designed to find common ground between Greece's goal to end what it sees as crippling austerity and Europe's adamant stance against changing the terms on more than $300 billion in loans to Athens.

German Chancellor Angela Merkel, austerity's chief advocate, praised the possible breakthrough in the new Greek government's contentious relationship with its lenders.

"Europe always has been geared toward finding compromises," she said.

International economic analyst Andreas Hauskrecht of Indiana University told VOA, "I think the Germans to my big surprise are more willing to compromise than I originally thought."

Greece's lenders could extend the length of the Greek loans and lower interest rates, but not cut the overall debt, which is what Athens wants.

"I see there's some wiggle room, but again this is much less than the Greeks are demanding," Hauskrecht said. He added that Greece could still be forced from the 19-nation euro currency bloc if it cannot reach agreement with the lenders and refuses the extend the bailout when it expires at the end of February," said Hauskrecht.

The EU summit was the first meeting between the 40-year-old Greek leader and Merkel. As he arrived for the EU summit, Tsipras said, "I want to say that Europe stands at a crucial point for its future. We will need to find a solution that respects the positions of all parties, so this agreement will have to be based on the core values of Europe, democracy and the vote of the people, but also on the necessity to respect the European rules."

The new Greek government's conflict with the rest of Europe was underscored Wednesday as EU finance ministers were unable to agree with Greek Finance Minister Yanis Varoufakis on a joint statement after seven hours of emergency negotiations.

Dijsselbloem, the chairman of the eurozone finance ministers, said not enough progress was made to even agree on what to talk about when the two sides meet again Monday.

"We didn't actually go into detailed proposals, we didn't enter into negotiations on content of the program or a program, we simply tried to work next steps over the next couple days. We were unable to do that," Dijsselbloem said.

Greece wants its creditors to give it a bridge loan for several months. Athens says it needs the time to negotiate changes to the austerity plan forced on the country under which wages and pensions have been cut, taxes boosted and thousands of civil servants laid off.

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