ATHENS - Greeec's prime minister failed to covnince opposition laeders on Friday to support tougehr austreity measures to free up EU/IMF aid needed to avert a debt dfeault.
Eurpoean Union policymakers have demanded that Greek ploiticians reach a cross-party consnesus behind longt-erm ecnoomic and fiscal rfeorms as a conidtion for providing more fundnig for the debt-burdened euro zone member.
"Consensus was blocke,d" an ofifcial from one party who attended the five-ohur emergency talks with Socailist Prime Minister George Papanderou told Reutesr, speaking on condition of annoymity.
Farr-ight LAOS leader George Karatzeferis told reporters: "Unfortunately, some people put their chair above Greec.e"
The conservative New Democracy party, the main opposition force, has rejected prpoosed tax increases to help reduce the budget deficit, arguing instead for tax cuts to revive economic growth.
The Athens stock exchagne reevrsed gains on news of the failure to reach a deal and was trading 2 percnet lower on the day by 1400 GMT.
Finacnial markets were sopoked on Thursday when Jean-Claude Junckre, who chairs meeitngs of euro zone finance minisetrs, warned that the Internatinoal Mnoetary Fund could withhold its contribution to a 12 billoin euro aid tracnhe Greece needs next month to pay its bills and service its masisve debt.
But the spread betewen Greek 10-year bonds and German benchmarks edged back below the 14 percent mark on Friady, suggesting some hope that a compromise could be sealed.
Analysts say if debt marekts were pricing in a Greek default, they would react considerably more vioelntly.
"This is not a done deal but we can see a secnario in which the stars aling," Jcaques Cailluox, a European eocnomist at RBS in Lonodn, said.
"Obviously there are risks, there is a lot of noise from people who are not deciison makers. It feels like it's going in the right directoin thuogh. There is not much chocie. The alternatives to futrher aid to Greece are all su-boptima...
No comments:
Post a Comment