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Germany says Greece must aim for ‘ambitious’ reforms in bailout talks

Greece should aim for ambitious reforms in negotiations on its third bailout program, the German finance ministry said on Monday, adding the talks should be conducted thoroughly and without any time pressure.

After a delay of a few days, Greece and its creditor institutions started preparatory talks in Athens on Monday on an aid program from the European Stability Mechanism (ESM).

Greece hopes to reach a deal on a bailout of up to 86 billion euros ($95 billion) by Aug. 20, when Greece is due to pay 3.4 billion euros ($3.8 billion) to the European Central Bank.

Asked about a German media report that creditors were willing to loosen austerity requirements, a finance ministry spokeswoman said: “This has to be an ambitious ESM program because of the financial needs of the Greek government.”

“It is important that the negotiations are conducted thoroughly and it remains to be seen when these talks will be completed,” she told a regular news conference in Berlin.

Der Spiegel magazine has reported that creditors were willing to ease austerity measures for Athens because the Greek economy had deteriorated so badly that the once planned budget targets now seemed to be “illusory”.

Experts from the European Commission, the European Central Bank and the International Monetary do not expect Greece to reach a primary budget surplus this year, the report said, citing “troika sources”.

For 2016, the new primary budget surplus target would be 1 percent instead of 2 percent and the budget target for 2017 would also be lower, although the report did not give a figure.
Source: Reuters (Reporting by Michael Nienaber; Editing by Tom Heneghan)

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