ATHENS: Wide differences over pension and labour reforms continued to dog intensive negotiations between Greece’s leftist government and its international creditors despite progress in other areas as the country’s cash position becomes increasingly critical.

Government spokesman Gabriel Sakellaridis sounded the alarm on Monday, saying that while Athens intended to meet all its payment obligations, including nearly 1 billion euros to the IMF in May, it needed fresh funds before the end of the month.

“Liquidity is a pressing issue,” Sakellaridis told a news conference.

“The Greek government is not waiting until the end of May for a liquidity injection. It expects this liquidity to be offered to the Greek economy as soon as possible.”

Labour Minister Panos Skourletis said the International Monetary Fund, Greece’s second biggest creditor after euro zone governments, was insisting on tough policy conditions for an interim deal to unlock frozen bailout aid.

The global lender was unyielding in demands for pensions cuts, rules to ease mass layoffs of private sector workers and opposition to a government plan to raise the minimum wage, Skourletis told Mega TV. “They are asking us to not touch anything (of the austerity measures) that have ruined Greek people’s lives in the last five years,” he said.

“The IMF is the most inflexible side ... the most extreme voices of the Brussels Group,” the minister said.

“But there are also calmer voices.”

Greece faces repayments to the IMF totalling 970 million euros by May 12. It has been borrowing from municipalities and government entities to meet obligations.

Intensive talks on an interim deal between a reshuffled Greek negotiating team and representatives of the European Commission, the European Central Bank and the IMF, renamed the “Brussels Group”, have been under way since last Thursday.

A European Commission spokesman said the negotiators worked through the weekend. Talks were “constructive” but work remains, he said, declining to give details.

The aim is to achieve a technical-level accord that would enable eurozone finance ministers to declare when they meet on May 11 that there is a prospect of concluding the bailout review successfully. That could give the ECB grounds to permit Greek banks to buy more short-term treasury bills, easing the government’s cash crunch.

On Sunday, Greek and eurozone officials reported progress on some issues and forecast a result by Wednesday, when the ECB holds its weekly review of emergency lending to Greek banks.—Reuters

Published in Dawn, May 5th, 2015

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