UPDATE 1-EU’s Juncker: mission to mull new Greek reforms-report

* New austerity steps to be discussed

* Package to have common, not different terms for EU/IMF

* Juncker says euro zone money is there if needed

(Adds quotes, context)

By Michael Winfrey

ATHENS, April 19 (BestGrowthStock) – European and International
Monetary Fund officials will discuss the possibility of more
austerity measures for Greece, a top EU official was quoted as
saying on Monday, as a delay in talks put pressure on Greek

The euro zone member hopes to begin talks with the mission
on Wednesday on a three-year policy programme that investors are
increasingly convinced will lead the debt-stricken country to
tap an EU/IMF aid mechanism.

Originally slated for Monday, the meetings were delayed by a
volcanic ash cloud that has wreaked havoc with transport across
Europe, adding to uncertainty that prompted investors to push up
Greek yields and dump bank shares.

Greece has already cut public sector wages, frozen pensions,
and raised taxes to try to cut its budget deficit by around a
third to 8.7 percent of GDP this year.

Eurogroup chairman Jean-Claude Juncker told Greek financial
website Euro2day the measures for 2010 were “pretty ambitious
and look credible”.

But, in an interview published in Greek and translated back
into English, he added: “During our talks with the troika
(European Central Bank/European Commission/International
Monetary Fund) on the Greek package, the possibility of new
measures will be discussed.

However, this was not an immediate issue, but one for the
whole process, he said.


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The Mediterranean country of 11 million has yet to ask for
the aid safety net, which at an estimated 45 billion euros
($62.91 billion) in the first year, would be the largest such
bailout ever attempted if Greece opts for it.


Some IMF officials had already arrived in Athens on Monday,
but Greek officials are expected to wait for members of the
other institutions to show up before starting talks.

The IMF has said the mission should last 15 days and any
agreement would be finalised shortly afterward by its board.

Juncker said the programme to be agreed would be on common
terms, rather than having some benchmarks for the IMF and others
for the European bodies.

“In no way will there be different terms from the euro zone
and other ones from the IMF. It will be a programme of common
terms,” he said.

The premium investors demand to buy Greek government bonds
rather than German benchmarks rose to a euro era record of 469
basis points on Monday, up 26 basis points from Friday’s close.

Greece must raise roughly 12.6 billion euros by the end of
May to refinance debt, make bond interest payments, and finance
its deficit, with the next test a sale of 1.5 billion euros in
short-term debt on Tuesday.

Juncker said one major problem was that it appeared markets
did not trust the euro zone to step in and help Greece if it
were to request financial aid. He said this was not true.

“My only concern is that markets seem to think the euro zone
will not be there in the case of a request (for aid),” he was
quoted as saying.

“What I must say is that the euro zone will assume its
responsibilities. We have said it many times, there is European
money when it becomes necessary.”
Stock Market Research

(Additional reporting by George Georgiopoulos; Editing by Toby

UPDATE 1-EU’s Juncker: mission to mull new Greek reforms-report