•    HOME   
•    NEWS   
•    BUSINESS   
•    INTERNATIONAL   
•    TECH   
•    SPORTS   
•    LIFE & TIMES   
•    OPINION   
•    MY JAKARTA   
•    BLOGS   
•    EYEWITNESS   

Greek government coalition leaders ended lengthy talks on austerity measures Wednesday, with one remaining point of disagreement, the prime minister's office said.

The three coalition partners who took part in the talks on a rescue plan for the Greek economy reached agreement on "all the points of the plan except one" said the prime minister's office which still hopes for a complete deal to be reached by Thursday evening.

The remaining bone of contention is "the reduction of pensions," a government source told AFP, after the coalition talks broke up.

Representatives of the EU, IMF and European Central Bank, which have been organising massive bailout loans for debt-laden Athens, went straight into talks with Greek Prime Minister Lucas Papademos after the eight-hour coalition talks ended, a government source told AFP.

The EU-IMF-ECB troika talks with Papademos were aimed at "concluding a deal before the Eurogroup meeting," of eurozone finance ministers scheduled to take place in Brussels on Thursday.

Agreement on new measures demanded by the EU, the IMF and the European Central Bank -- known as the 'troika' -- and on a debt-write down by banks would open the way for a second rescue and so close a key chapter in the eurozone crisis.

This money is vital to prevent eurozone member Greece from defaulting on 14.5 billion euros ($19.2 billion) worth of payments to bond holders which will fall due on March 20.

The socialist, conservative and far-right leaders must approve reported cuts to the minimum wage -- strongly resisted by unions -- in addition to pension reductions and 15,000 civil service redundancies.

Far-right leader Georgios Karatzaferis was the first to emerge from the coalition talks late Wednesday, denouncing the pressure which the troika of creditors was bringing to bear on the government for more painful cuts in public spending.

"I made clear my intentions right at the start of the meeting. I cannot in one hour sign up to a plan which will affect the country for 40 or 50 years with receiving (legal) assurances that the measures are going to get the country out of its impasse," he told reporters.

According to Papademos' office "Mr Karatzaferis expressed numerous reservations," about the plan.

Conservative leader Antonis Samaras stressed that "talks will continue on the question of retirement."

"At this difficult moment, we must take care of retirees," he said.

The party heads earlier in the day received a 50-page text with the austerity cuts demanded in return for new loans under a 130-billion euro ($171-billion) eurozone bailout originally agreed in October.

The text was drawn up during a night of marathon talks between Papademos and representatives from the troika aimed at setting up a second rescue for Athens following an initial bailout worth 110 billion euros in May 2010.

Private creditors, who are negotiating with Greece a debt write-off worth at least 100 billion euros, are to meet on Thursday in Paris, according to a spokesman.

Greece has run up total debt of about 350 billion euros, roughly 160 percent of its gross domestic product, and the IMF has insisted that level be brought down to a maximum of 120 percent of GDP in 2020.

The Wall Street Journal reported on Wednesday that the ECB would participate in a writedown of Greece's debt by agreeing "to exchange the government bonds it purchased in the secondary market last year at a price below face value, provided the debt-restructuring talks have a successful outcome."

On bond markets, where tension has eased markedly since the beginning of the year, the reaction was subdued.

"Whether this turns out to be the good news that the market is currently expecting, or another short term rally followed by a painful pull back remains to be seen," analyst Alistair Cotton said in a note.

"But there is reason to remain sceptical given the number of times over the last two years news about a Greek rescue deal moved the market in exactly the same way; euro positive on the rumour, retracement on the fact," he said.

AFP