IMF says new rescue deal with Greece in 'days'

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IMF says new rescue deal with Greece in 'days'

The Associated Press Published Wednesday, February 1, 2012 6:18AM EST

This Sept. 21, 2009 photo shows a view of Oia village on the island of Santorini, Greece. (AP Photo/Michael Virtanen)

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ATHENS - An IMF debt inspector says negotiations for landmark debt deals with Greece will be concluded in a "matter of days" but pressed the recession-hit country to lower employment costs and even slash the minimum wage.

The head of the International Monetary Fund's mission in Greece, Poul Thomsen, said in an interview published Wednesday that talks for a new $171 billion bailout package would be over "very soon."

That deal is linked to an agreement with private creditors to accept losses on Greek bonds, which will cut C100 billion off the country's national debt.

"Yes, it's a matter of days," Thomsen was quoted as saying by the Athens daily Kathimerini. "The discussions for the (new) program will be concluded very soon."

Thomsen insisted wages in Greece remain too high, and that was hurting the country's competitiveness. He urged the government to consider cutting the minimum wage of $988 gross pay per month.

Greek unions and employers are to resume negotiations on Thursday in an effort to cut labour costs, but both sides are already in agreement that the minimum wage and basic private sector pay should not be affected, warning such a move would only deepen the country's recession.

Greece and its creditors are anxious to close the new rescue deals ahead of a March 20 Greek bond repayment worth $19.1 billion that threatens the country with bankruptcy and the eurozone with a major crisis.