ATHENS Nov 19 International lenders will
Greece's fractious political parties on Saturday to give
written guarantees that they will back austerity measures under
a bailout deal aimed at saving the country from financial ruin.
The leader of conservative New Democracy -- one of three
parties in the new national unity government of technocrat Prime
Minister Lucas Papademos -- has stirred dismay in the EU by
refusing to sign any pledge, saying his word is enough.
New Democracy chief Antonis Samaras has said his support for
the interim coalition is conditional and temporary, and has
begun jockeying for position before an election tentatively
slated for Feb. 19 in which he wants to win a big majority.
Representatives of the European Commission, the European
Central Bank and the International Monetary Fund -- the "troika"
which monitors Greek compliance with its rescue deals -- were
expected to meet Samaras in Athens on Saturday.
They will also hold talks with the other coalition parties,
the Socialist PASOK and the small far-right LAOS, to measure
their commitment to implementing a wave of spending cuts and tax
increases needed to unlock more loans.
Underscoring the pressure on Athens, Dutch Finance Minister
Jan Kees de Jager said on Friday the parties had "to make a
clear and unequivocal choice in writing" by signing a pledge.
"Are they with us or not? We don't have the luxury of
patience any longer," he said.
EU leaders, weary of Greece's failure to deliver on fiscal
targets, fear its politicians will try to wriggle out of their
commitments as the early election looms, especially if Athens
gets an 8 billion euro installment under an old bailout deal.
The new bailout, approved last month, is worth an additional
130 billion euros and is meant to keep the country of 11 million
people financed until 2014.
Greece's debt troubles over the past two years have turned
into a major European crisis that threatens the survival of the
euro and the stability of the global economy.
As Greek politicians bickered this week, borrowing costs for
much larger euro zone countries such as Italy and Spain were in
the danger zone while even France's rose.
Support for both PASOK and New Democracy, which have
dominated Greek politics for decades, has eroded over the past
week, opinion polls show.
However, more than two thirds of voters back Papademos, a
former central banker who is the sole technocrat in a coalition
otherwise made up of party politicians.
New Democracy repeated an oft-made call on Friday to scrap
the austerity measures prescribed under the bailout -- known as
the "Memorandum" in Greece -- in favour of pro-growth policies.
"The Memorandum needs to be renegotiated. A recipe that
doesn't work needs to be changed," it said in a statement.
It is not clear whether the EU and IMF will demand more
financial pain from Greeks.
Papademos's cabinet submitted a draft 2012 budget to
parliament on Friday that foresees no new austerity measures
next year, provided that reforms are enacted.
The draft, expected to be approved in the next few weeks,
predicts a fifth year of recession but says a plan to convince
Greece's private creditors to take a 50 percent loss on bond
holdings could cut the budget deficit by more than a third.
The document forecasts that Greece's 220 billion euro
economy will shrink 2.8 percent in 2012 after a 5.5 percent
contraction this year.