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Greek debt talks reach crucial stage

A man holds a wooden cross asking 'Where are the Thieves' during a strike
A man holds a wooden cross asking 'Where are the Thieves' during a strike

Greece is due to resume talks on a private creditors' debt writedown with separate discussions on a new eurozone bailout loan.

At yesterday's talks, the Institute of International Finance, which is representing the banks and financial institutions, said progress was made and the talks were positive.

Under the so-called private sector initiative, banks and other financial institutions are expected to take at least a 50% "haircut" on their Greek debt, which would remove about €100 billion from the Athens government's debt mountain of more than €350bn.

Meetings also begin today with senior representatives from the Troika comprising the European Union, International Monetary Fund and the European Central Bank.

They will discuss the next three years of an economic blueprint adopted by Greece in return for the financial assistance received so far.

The IMF has said it is ready for talks on extra rescue funds needed to keep Athens from defaulting in March.

A spokeswoman said such an arrangement would require exceptional access under the Fund's lending rules.

The EU and IMF have already provided Greece with two-thirds of a €110bn debt package agreed in May 2010, with an audit on the implementation under that deal set to resume today.