News / Europe

Greek Party Leaders Move Closer to Deal on More Spending Cuts

The Parthenon on the Athens Acropolis is seen behind a Greek and an EU flag atop the Greek ministry of finance, February 8, 2012.
The Parthenon on the Athens Acropolis is seen behind a Greek and an EU flag atop the Greek ministry of finance, February 8, 2012.

Talks between Greek political leaders on whether to accept the EU demand for more spending cuts broke up early Thursday with only one outstanding issue remaining.

The heads of the three political parties that make up the coalition government must agree on the spending cuts before the European Union and International Monetary Fund grants another badly needed rescue package.

Reports say the party chiefs and Prime Minister Lucas Papademos have agreed on all points except for pensions cuts. They plan to meet again later Thursday.

Demands by Greece's international creditors include a 20 percent cut in the minimum wage, a 15 percent cut in some pensions, and eliminating 15,000 civil service jobs. Without approval from Greek party chiefs, the lenders will not hand Greece a new $170 billion bailout, its second in two years.

Greece needs the money to avoid default when $19 billion in bond payments come due in March. Greece is negotiating a bond swap with its lenders, asking them to accept less than what they are owed.

Greek workers have held a series of general strikes and large street protests, saying they cannot make any more sacrifices.

Video of Greek police clashing with striking workers in Athens

 

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