Lenders leave Athens with no deal for Greeks

 

Negotiations between Greece and its creditors ended Thursday without agreement on freeing up fresh funds, a government source told AFP.

An IMF spokesman said the talks will resume next week.

"This phase of the discussions is over, there was good progress but there are still difficulties, which we will try to resolve between now and the meeting of eurozone finance ministers on March 20," said the source.

After months of impasse due to disagreement between the International Monetary Fund and the eurozone over how to end the crisis, talks between Athens and its creditors resumed last week.

IMF spokesman Gerry Rice said negotiators made progress "on a balanced fiscal package and a number of key reforms, notably in the financial sector."

"Discussions will continue next week, notably on pension and labour market reforms," he said in a statement.

Rice told reporters earlier in the day that "differences remain in important areas," and that it was too soon to say when an agreement could be reached.

The Greek government source said the IMF wants the labour market further liberalised, and differences also remain over budget policy from 2019.

The EU and IMF negotiators were scheduled to leave Athens late Thursday or early Friday.

The IMF has repeatedly said that Greece's debt is not sustainable, and the country requires debt restructuring. The fund will not participate in a new loan program if it considers the debt untenable.

But European governments, especially Germany, have resisted providing more debt relief and dispute the fund's analysis, instead calling for more economic policy steps.

The deadlock has spooked markets with fears of a return to the crisis two years ago when Greece nearly crashed out of the euro, the European single currency.

Athens needs the next tranche of bailout cash to meet seven billion euros ($7.4 billion) of new debt payments in July or risk defaulting on its loans.

The European Commission wants an agreement before a series of upcoming elections, and has been pointing to improved budgetary performance in Greece.

Three bailout programmes have kept the country from economic collapse, but an expected return to growth has not come about, with the latest data showing the economy stalled last year, after having shrunk by 25 percent since 2008.

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