Greece Hopes EU's Moscovici Can Break Bailout Deadlock


Top EU economic affairs official Pierre Moscovici met Greek leaders in Athens on Wednesday in a bid to break the deadlock between the debt-laden country and its creditors.

The visit by the former French finance minister comes after months of failed talks between Athens and its eurozone and International Monetary Fund (IMF) lenders.

The feuding has blocked new loans from Greece's 86 billion euro bailout that Athens needs for debt repayments of 7.0 billion euros ($7.44 billion) this summer.

"We still have a long way to go before a final agreement," Moscovici was reported as saying by Greek media before his meetings.

He added that February 20, when the next meeting of eurozone ministers takes place, is a "crucial date".

The meeting in Brussels is seen as an unofficial deadline to end the stalemate ahead of important elections in Europe.

Moscovici, who is viewed as an ally of Athens, was due to meet Prime Minister Alexis Tsipras after talks with Finance Minister Euclid Tsakalotos.

There has long been a split between the IMF and Europe over a demand by the eurozone that Greece deliver a primary balance, or budget surplus before debt repayments, of 3.5 percent of GDP. The IMF has said only 1.5 percent is feasible.

The Tsipras government refuses more pension cuts and tax hikes, which the IMF, quietly backed by Germany, insists are necessary for Greece to deliver on its targets. 

On Tuesday the Greek government hailed figures showing the country had returned to annual growth in 2016, using it for a fresh assault on further austerity measures.

Early estimates from the national statistics office and projections from Brussels showed growth of 0.3 percent last year.

Ahead of his visit, Moscovici said he was ready to work to alleviate differences between Athens and its lenders, calling for a "balanced package".

"I think that it's impossible to impose more austerity... but it is necessary and legitimate to have some more reform in order to have a more competitive and solid economic system in Greece," he told the euronews channel on Monday.

Talks in Brussels between Greece and its creditors on Friday ended with no breakthrough, although Eurogroup chief Jeroen Dijsselbloem said some progress was made.

But Dijsselbloem warned on Tuesday warned that the standoff was likely to drag on. 

"The IMF has to come on board," he told Dutch broadcaster RTLZ.

"It will take more time. People think that as there is a Eurogroup meeting next week we must have something worked out. But that has not been my planning."

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