Eurozone fails to reach an agreement on Greek aid

Last updated 17:26 21/11/2012

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European Union officials failed Wednesday to reach a deal on giving Greece more financial aid, prolonging uncertainty over the future of the debt-hobbled country and the 17-member eurozone.

Jean-Claude Juncker, chairman of the meeting of finance ministers from the 17 EU countries that use the euro, said the talks, which lasted nearly 12 hours, would reconvene on Monday.

He said that the finance ministers "made progress in identifying a consistent package of credible initiatives" aimed at making a further substantial reduction in Greek government debt.

There has been disagreement among the ministers and the International Monetary Fund; Greece's other bailout creditor, on how to make Athens' debt manageable. The eurozone ministers are in favour of giving Greece an extra two years, to 2022, to bring its debt to 120 percent of gross domestic product. The IMF has resisted such an extension.

Agreement on this issue is needed for the group of creditors to pay Greece the next batch of its rescue loans, expected to amount to (euro) 44.6 billion. Greece needs the money to avoid bankruptcy.

Juncker, however, said he was optimistic that a deal could be reached.

"We are very close to a result. We see no major stumbling block," he said. There are technical issues and calculations to be made in coming days, he said.

IMF managing director Christine Lagarde sounded a more cautious note, saying only "we have narrowed the positions."

Greece has been relying since 2010 on international bailout loans, under terms supervised by the so-called troika of the IMF, the European Central Bank, and the European Commission, which is the 27-country European Union's executive branch.

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- AP

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