EU officials say Greece not close to debt deal | Business| Economy and finance news from a German perspective | DW | 27.05.2015
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EU officials say Greece not close to debt deal

Greece's government has said it is starting to draft an agreement with creditors that would unlock another bailout installment for the cash-strapped country. But European officials quickly dismissed the reports.

A Greek government official was quoted by news agencies Reuters and AFP as saying on Wednesday that his country and its creditors had started drafting a technical-level agreement, pointing to progress in long-running talks to unlock more financial aid for the cash-strapped southern eurozone nation.

"At the Brussels Group of credit negotiators, procedures to draw up a staff-level agreement are beginning," the government source said.

This is the closest that Greece and its creditors have come to a deal to unlock 7.2 billion euros ($7.8 billion) of bailout loan money in roughly four months of talks.

Concessions on both sides?

The official's statement appeared to suggest significant advances in negotiations with both the European Union and the International Monetary Fund (IMF).

However, the government official quoted by the news agencies hastened to add that "there remains a problem with the differing stance among the institutions; if an agreement by the IMF were not needed, the deal would have closed by now."

The source pointed out the agreement would avoid wage and pension cuts, but include reform of value-added taxes and setting a lower target for primary surplus - the government budget surplus before counting in payments on the national debt - in the first year to give Athens more financial wiggle room.

But European Commission Vice President Valdis Dombrovskis said the two sides still had some way to go before any agreement could be drawn up. "We are working very intensively to ensure a staff-level agreement," he said. "We are still not there yet."

Rising pressure

The talks between Greece and its international creditors are unlikely to result in an early agreement, German government officials say. "We have not advanced much further on the matter," said members of the German delegation in Dresden for the Group of Seven finance ministers' meeting.

They expressed surprise at statements from Athens saying that Greece was close to reaching a deal with its creditors.

The conflicting statements come as pressure grows on Greek Prime Minister Alexis Tsipras to strike a deal before the country faces a 300 million-euro payment to the IMF on June 5, which several government officials say Athens does not have money for.

hg/sri (AFP, Reuters, dpa)

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