Greek Leaders Fail to Reach Consensus on Austerity

15:55 28/5/2011 - Πηγή: i-Reporter

ATHENS — At an emergency meeting on Friday, the country’s political leaders failed to agree on new austerity measures proposed by the government, but Prime Minister George Papandreou said there was still hope that an agreement would be reached. “Essentially, there are many points on which we can agree,” he said, speaking to the nation

in a televised speech. “But there is a need for political will from all sides.”

“Over the next few days we will continue efforts to reach a consensus,” he continued, adding that “the government has assumed the responsibility to extract the country from the crisis and will do this with or without consensus.”

But leaders of the opposition parties have refused to fall in behind the president, Karolos Papoulias, who had called the meeting. The measures have been proposed by Mr. Papandreou’s Socialist government.

The aim of Friday’s meeting was to convince officials of the European Union and International Monetary Fund that Greece is serious about repairing its finances, and has the political will to impose more tax increases and spending cuts on a public already weary after a year of belt-tightening. The effort came amid mounting speculation about the Greek government’s ability to avert a default, which would very likely lead to a new financial crisis across the euro zone.

Olli Rehn, Europe’s commissioner for economic and monetary affairs, said in a statement that the commission “regrets the failure of Greek party leaders to reach consensus on economic adjustment to overcome the current debt crisis.”

“An agreement has to be found soon,” Mr. Rehn said. “Time is running out.”

Earlier in the day, Antonis Samaras, the leader of the country’s main conservative opposition party, New Democracy, said he would not back a program that would “raze Greece’s economy and destroy its society.”

He called for the renegotiation of the terms of an agreement with the union and the I.M.F., which last May pledged 110 billion euros in loans to Greece in exchange for the country’s getting its fiscal house in order.

Mr. Samaras also reiterated calls for an alternative approach to Greece’s finances, one that favored the lowering of taxes and faster privatization of state assets.

Other leaders also criticized the Socialists’ plan. Among them was the leader of the Communist Party, Aleka Papariga, who said Greeks were being subjected to “ideological terrorism” and should not give in to “coercive dilemmas.”

On Thursday, the head of the group of euro zone finance ministers, Jean-Claude Juncker, said again that the European Union would be unlikely to step in if the I.M.F. withheld its portion of a fifth installment of emergency funding to Greece — 12 billion euros ($17 billion) scheduled to be disbursed next month.

Greece’s lenders are demanding additional measures after the country missed its deficit-reduction target for 2010, putt