Greece creditors to begin bailout talks

  • 24/07/2015
Greek Prime Minister Alexis Tsipras (Reuters)
Greek Prime Minister Alexis Tsipras (Reuters)

Greece's creditors will head to Athens shortly to begin talks on a mammoth new bailout after the country's parliament approved a second batch of reforms needed for the negotiations to proceed.

Greece's finance ministry on Thursday (local time) said representatives from the European Union, European Central Bank and International Monetary Fund, from whom Athens is seeking a third bailout worth up to 86 billion euros over three years, were likely to fly in on Friday.

But a European source said it was not yet confirmed that the talks would begin Friday, adding that at most "only a few people" from the so-called troika of creditors would arrive before the weekend.

"Our people haven't bought their airline tickets yet," the source said.

Greece and its creditors last week struck a bailout deal aimed at preventing Athens from crashing out of the eurozone as it struggles to pay its enormous debts.

But the IMF warned on Thursday that finalising the deal, which is conditioned on Greece implementing painful reforms, would not be easy.

The IMF has helped bail out Greece twice previously but has said it will only participate this time around if European creditors reduce Athens' debt burden to a level it considers "sustainable".

"Clearly it's a difficult path ahead, we're just at the beginning of the process," said IMF spokesman Gerry Rice.

Figures released by the finance ministry on Thursday showed state spending already down significantly this year, falling 11 percent to 23.2 billion euros in the first six months, compared with 26 billion in the same period in 2014.

But state revenues also took a hit, coming in at 21.8 billion euros, down from 23.6 billion in the first six months of 2014.

In the early hours of Thursday, the Greek parliament passed further reforms demanded by creditors for bailout talks to begin, including changes to the justice system, a bank deposit protection scheme and measures to shore up the liquidity of Greece's banks.

The bill passed by a resounding 230 votes out of the 298 members of parliament present, after a five-hour debate that once again exposed deep divisions in the governing Syriza party over whether to accept more austerity.