Greece says bailout review deal close, labor issues remain open

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[March 09, 2017]  ATHENS (Reuters) - Greece and its international lenders are close to a deal on its bailout review but differences remain on labor issues, the government's spokesman said on Thursday.

A man looks down as a Greek national flag flutters atop one of the bastions of the 17th century fortress of Palamidi under an overcast sky at the southern port city of Nafplio, Greece, February 19. 2017. REUTERS/Alkis Konstantinidis

 

Dimitris Tzanakopoulos said a comprehensive deal would include a change in Greece's fiscal mix from 2019 and clarity on medium debt-relief measures.

"Our aim is to have the discussions on a staff level agreement concluded by the next eurogroup meeting (of euro zone finance ministers) of March 20," he told reporters.

Creditors started fresh negotiations with Athens last week on signing off on a new bailout review under terms of the country's 86 billion euro ($91 billion) financing facility.

Tzanakopoulos said a deal would allow Greece to participate in the European Central Bank's asset purchase program and return to financial markets.

"Once we have a comprehensive agreement, there will be a discussion by the ECB on including Greece in QE (quantitative easing). I think there will be a positive development on this issue."

Greece's reference to a 'comprehensive deal' includes a staff-level agreement with lenders on labor and energy market reforms, clarity on medium-term debt restructuring, and another batch of fiscal measures from 2019 to keep the country's primary surplus - excluding debt servicing costs - at about 3.5 percent.

The International Monetary Fund is seeking a relaxation to labor laws which would allow mass layoffs.

"Views of the IMF and Greece are different. We will try to bridge these differences," Tzanakopoulos said.

($1 = 0.9467 euros)

(Reporting by Renee Maltezou; editing by John Stonestreet)

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