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    Eurozone ministers struggle to agree on new aid for Greece


    door EUXTV

    As workers in Greece prepare for a general strike today (15 June), EU finance ministers yesterday night failed to reconcile a German-led push for bondholders to share part of the cost of a new Greek aid package, amid warnings from the European Central Bank (ECB) that any coercive solutions could unleash a new wave of contagion.

    "There has been no result," German Finance Minister Wolfgang Schaeuble told reporters after talks in Brussels which ended late yesterday. Eurozone finance ministers agreed to meet again on 19 June.

    Ministers did concede that some progress was made despite the lack of agreement. "We are very close to an agreement with all private partners. But there must be a balance: a real effort on Greece's part - help from the IMF, the euro zone and the European Union; and participation of the private sector," said Belgian Finance Minister Didier Reynders.

    Finnish Finance Minister Jyrki Katainen said that most countries indicated that some sort of private sector involvement was crucial.

    "I want to underline that we have to avoid, whatever it takes, the next financial crisis. The balance is very difficult," declared Katainen.

    Ahead of a summit of EU leaders on 23-24 June at which a new aid package for Greece is expected to be finalised, Germany is pushing for Greek bond maturities to be extended for seven years, giving it more time to right its economy and sell off state assets.

    Rating agencies have warned they would see such a step as coercive and akin to a default.

    German Chancellor Angela Merkel and French President Nicolas Sarkozy will meet on 17 June in Berlin, with pressure mounting for the leaders to resolve their differences over a rescue for Greece, which was downgraded this week to the world's lowest credit rating by Standard & Poor's.

    The European Central Bank also opposes Berlin's plan and is pressing the bloc to opt for a softer solution that would seek contributions from the ...