Greek leaders failed early on Thursday to agree on reforms and austerity measures, the price of a bailout to avoid a messy default, forcing Finance Minister Evangelos Venizelos to go to the country’s financial backers with an incomplete deal.
Athens’ partners in the European Union and the International Monetary Fund are increasingly exasperated by a lack of agreement on the measures they demand in return for a 130 billion euro ($172 billion) bailout and time is running out for Greece before a major March 20 bond redemption.
Euro zone officials say the full package must be agreed with Greece and approved by the EU, IMF and European Central Bank before February 15 so legal paperwork can be completed in time to avoid a chaotic default that could threaten global economic recovery.
But after all-night talks with leaders of the three parties in the Greek coalition and with chief EU and IMF inspectors, Venizelos emerged shortly before dawn to say that one issue was unresolved.
“I am leaving for Brussels in a short while with the hope that the Eurogroup meeting will be held, and a positive decision on the new program will be taken,” he told reporters.
“The financial survival of the country in the coming years depends on the new program … It is time of responsibility for everyone.”
Venizelos had hoped to present to his fellow euro zone finance ministers in Brussels a fully-fledged deal on a new bailout plan, including a commitment for 3.3 billion euros in budget cuts this year.
A spokesman for the socialist PASOK party said disagreement over pension reform had been the stumbling block.
Prime Minister Lucas Papademos said earlier he hoped the party leaders could sort out their differences before euro zone finance ministers meet at 10 a.m. EDT.
Before then, all eyes will be on what the ECB is willing to do to help Greece at its monthly policy meeting.