The end-game in Greece continues to rumble on into another day of negotiations. On the rhetoric front, matters have heated up as well. Neelie Kroes, the Dutch EU commissioner told De Volkskrant, "It's always said, if you let one nation go, or ask one to leave, the entire structure will collapse. But that is just not true."
Talks between the leaders of the Greek political parties will continue at 2pm GMT today, after Greek Prime Minister Lucas Papademos held talks with the EU/IMF/ECB troika late into the night yesterday. Unfortunately, it doesn’t seem as if much was achieved. We expect that the issue of this new debt repayment account for eurozone bailout funds was broached and developed with the (likely reluctant) Greek authorities. Essentially, this funnels more funds into paying off Greek debt rather than using it to boost competitiveness or improve governance in anyway.
Following the talks Greek Finance Minister Evanagelos Venizelos was surprisingly blunt, saying, "Unfortunately the negotiations are so tough that as soon as one chapter closes, another opens."
As we noted yesterday, some progress was made towards deal between the Greek political parties, as they agreed in principle to 15,000 additional public sector job cuts, a reduction in the minimum wage and supplementary pensions. However, these cuts still do not meet the demands made by the troika, while the details of how they will be implemented are still to be ironed out.
We will continue to update this blog with developments in Greece throughout the day.