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Greek debt talks drag on but banks signal progress

ATHENS, Greece — Greece's private creditors signaled progress late Tuesday in a bond-swap deal, but crucial debt negotiations over another round of austerity measures dragged into another day.

Greek Premier Lucas Papademos delayed a meeting with his coalition parties until today, staying in talks until late in the night with top bank negotiators as well as with debt inspectors from the European Union and the International Monetary Fund.

The bond deal with banks and other private creditors aims to reduce Greece's debt by some $131 billion and is required by the EU and the IMF for Greece to get a second rescue bailout to avoid bankruptcy next month.

Representatives of the Institute of International Finance, which has been leading the talks for private bondholders on forgiving Greece part of its debts, had a "constructive meeting" with Papademos, said Frank Vogl, spokesman for the institute.

Anger flared on the streets of Athens as more than 20,000 protesters marched through the Greek capital and unions called a general strike Tuesday against new cuts in jobs and spending. The strike halted trains and ferries, closed schools and banks and put state hospitals on short staffing.

Several hundred protesters clashed with riot police outside Parliament and set fire to a German flag — upset over Germany's role in demanding more austerity from Athens.

Greek debt talks drag on but banks signal progress 02/07/12 [Last modified: Tuesday, February 7, 2012 10:58pm]
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