Tense last-minute talks

Ne­go­ti­a­tions said to trip on la­bor con­tracts as Moody’s down­grades Greece again

Kathimerini English - - Front Page -

As gov­ern­ment of­fi­cials and rep­re­sen­ta­tives of Greece’s for­eign cred­i­tors sought to fi­nal­ize de­tails of the gov­ern­ment’s midterm fis­cal pro­gram and pri­va­ti­za­tion plan late last night amid re­ports of fresh ob­sta­cles in ne­go­ti­a­tions, Moody’s rat­ing agency struck an un­ex­pected blow to the process by down­grad­ing Greece yet again.

In a writ­ten state­ment is­sued by the Fi­nance Min­istry min­utes af­ter the agency’s de­ci­sion went pub­lic, Greek ir­ri­ta­tion with the tim­ing of the move was clear. “Moody’s de­ci­sion to down­grade Greece comes as rep­re­sen­ta­tives of the EU, ECB and IMF are in Greece to eval­u­ate the coun­try’s eco­nomic pro­gram,” it said, re­fer­ring to Greece’s cred­i­tors by their acronyms.

Cit­ing an in­creased risk of Greece han­dling its debt prob­lems with­out an even­tual re­struc­tur­ing, Moody’s down­graded Greece to Caa1 from B1. The agency also re­ferred to “highly un­cer­tain” growth prospects and missed tar­gets in bud­get re­forms. The min­istry said Moody’s de­ci­sion “had been in­flu­enced by in­tense spec­u­la­tion in the me­dia” and that it ig­nored the Greek gov­ern­ment’s com­mit­ments to meet its fis­cal tar­get and to ac­cel­er­ate its pri­va­ti­za­tion pro­gram.”

Mean­while, sources told Kathimerini that talks in Athens be­tween gov­ern­ment of­fi­cials and vis­it­ing en­voys – orig­i­nally due to be con­cluded by to­mor­row – had stum­bled on a dis­pute over col­lec­tive la­bor con­tracts. La­bor Min­is­ter Louka Kat­seli re­port­edly ob­jected to the of­fi­cials’ de­mand that em­ploy­ers who do not sign up to col­lec­tive la­bor con­tracts should not be bound by their terms. Kat­seli is said to have the back­ing of Prime Min­is­ter Ge­orge Pa­pan­dreou on this is­sue.

One point on which the gov­ern­ment and its cred­i­tors were said to see eye-to-eye was on an am­bi­tious pri­va­ti­za­tion pro­gram, agree­ing to bring for­ward sev­eral sell-offs planned for 2012 to this year and launch­ing those slated for 2014 and 2015 by the end of next year. The new plan re­port­edly fore­sees the state sell­ing a 21 per­cent stake in Athens In­ter­na­tional Air­port (cur­rently 55 per­cent state-owned) as well as its en­tire 34 per­cent stake in Hel­lenic Post­bank and 40 per­cent of its 74 per­cent stake in the Thes­sa­loniki Wa­ter Sup­ply and Sew­er­age Com­pany (EYATH). The only pri­va­ti­za­tion pro­ject ac­tu­ally un­der way is the sale of a fur­ther stake in OTE tele­com.

Late yes­ter­day, Pa­pan­dreou’s of­fice said the premier is to travel to Lux­em­bourg to­mor­row for talks with Prime Min­is­ter Jean-Claude Juncker, who is chair­man of the Eurogroup coun­cil of Euro­pean of fi­nance min­is­ters.

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