Disagreements between EU and IMF are obstructing negotiations, say Greek government

Until recently the main argument of the institutions for not securing a deal, was that the Greek side had not submitted comprehensive proposals. “Now, it becomes apparent that the proposals have been submitted and substantial concessions have been made towards clinching an ‘honest compromise.’”
The same sources explained that the IMF considers pension reductions and labour relations reform as its ‘red lines’ while it is not so strict about the primary surplus. The IMF is also considering a debt write off, to make it viable.
On the other hand, the EU insists on the primary surplus as an important issue and is against any debt write down, while it is not so strict about reforms in labour laws and pensions.
Taken together, the government circles said, the result is that the institutions have ‘red lines’ everywhere: Pensions, labour laws, primary surplus.
“With these facts, there cannot be a compromise. The responsibility lies exclusively with the institutions and their inability to communicate between them,” the circles said.
To deal with this “blatant contradiction”, as the sources described them, the government has taken the initiative not to bring the omnibus bill to Parliament before there’s a prospect for an agreement, to include in talks the plan for Greece’s exit to the markets and to discuss funding growth in the post-June era.
Commenting on the Financial Times report, government circles said Peter Spiegel’s article reveals the conflicting strategies of the IMF and the Eurozone, as it claims that Poul Thomsen, head of the IMF’s European department, warned eurozone’s finance ministers that “it may hold back its portion of a €7.2bn tranche of bailout aid to Greece” if “European lenders do not write off significant amounts of its sovereign debt.”
At the same time, European Commissioner for Economic Affairs Pierre Moscovici confirmed the opposition between the IMF and the European Commission, stating that the debt issue may only be discussed only after a reform programme has been agreed.
It is a strategic disagreement, centered on Greece, which works against the country, they said.