Greece Resumes Crisis Talks But Still Struggles With Austerity

Another deadline slipped by on Tuesday after Greece postponed a “crunch meeting” where leaders were supposed to discuss reform and agree on austerity measures that would save the country from default.

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Heads of several political parties had yet to receive drafts of an agreement reached with the International Monetary Fund and European Union before they were supposed to meet with Prime Minister Lucas Papademos for negotiations, and so the meeting was postponed until Wednesday.

Greek parties must agree to a reform deal — a condition set by international lenders for a new rescue package — and have it approved by the euro zone, European Central Bank, and IMF before February 15.

Without a deal by next Wednesday, the so-called troika of international lenders won’t have enough time to ensure Greece receives its next tranche of aid before a 14.5 billion-euro debt repayment comes due on March 20.

But deadlines are losing significance. Finance Minister Evangelos Venizelos said last weekend that a deal had to be done by Sunday, but then parties sailed past a Monday deadline without giving their response to the EU, promising they would have a decision on Tuesday.

Party leaders are hesitant to accept harsh austerity measures as they are certain to mean a big drop in living standards for many Greeks. Furthermore, with parliamentary elections coming as soon as April, leaders are wary of making austerity cuts that are deeply unpopular among the Greek electorate.

Private and public sector unions GSEE and ADEDY called for a strike on Tuesday that saw protesters closing Greece’s main port, while tourists were locked out of popular sites and public transportation was disrupted during the morning rush hour.

Papademos will meet with leaders Wednesday to discuss the draft deal struck with the IMF and EU. Though most points have already been settled, the leaders will be presented with options on some fiscal issues.

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To contact the reporter on this story: Emily Knapp at staff.writers@wallstcheatsheet.com

To contact the editor responsible for this story: Damien Hoffman at editors@wallstcheatsheet.com