24 Jun 2012

More time sought by Greece

2:48 pm on 24 June 2012

Greece's new coalition government has proposed an extension to the deadline for it to reduce its budget deficit by at least two years, to 2016.

In a policy document, the government said its aim is for the fiscal target envisaged by the international bailout deal to be met without further cuts to salaries and pensions.

Greece is under huge international pressure to fulfil bailout terms.

Elections last Sunday ended a two-month deadlock over its implementation, with pro-bailout parties gaining a narrow majority in parliament.

The BBC reports the document was published following agreement on policy goals between the coalition partners New Democracy, Pasok and Democraftic Left.

The situation is expected to dominate an EU summit starting on Thursday.

Under the current bailout deal, Greece has agreed to take 150,000 civil servants off the payroll by 2015.

Inspectors from the EU, European Central Bank and International Monetary Fund are due in Greece on Monday to review Greece's progress in meeting bailout conditions.

An initial EU-IMF package worth €110 billion ($US138 billion) was obtained in 2010, with a follow-up this year worth €130 billion.

Greece has also had €107 billion of debt, held by private investors, written off.