BRUSSELS/ATHENS, Feb 14 (Reuters) – Euro zone finance ministers dropped plans on Tuesday for a special face-to-face meeting on Greece’s new international bailout, as the cabinet in Athens argued up to the last minute on plugging a 325 million euro ($427 million)gap in its austerity plan.

Ministers in the Eurogroup had been expected to gather in Brussels on Wednesday for a meeting which, if all had gone to plan, would have approved the 130 billion euro rescue and save Greece from a messy bankruptcy next month.

However, with the European Union’s patience with Greece close to breaking point, Eurogroup Chairman Jean-Claude Juncker said the ministers would hold only a telephone conference call before a regular meeting already scheduled for Feb. 20.

Juncker said he was still awaiting written undertakings from Greek party leaders on pushing through with the austerity package of pay, pension and job cuts – which parliament passed on Monday as rioters torched dozens of buildings in central Athens.

“I did not yet receive the required political assurances from the leaders of the Greek coalition parties on the implementation of the programme,” he said in a statement.

Juncker also said the funding hole required more talks with the “troika” of Greece’s EU and IMF lenders.

“It has appeared that further technical work between Greece and the troika is needed in a number of areas, including the closure of the fiscal gap of 325 million euros in 2012 and the debt sustainability analysis,” he added.

BRUSSELS (Reuters) – In the marathon tennis match that is the Greek debt crisis, the ball is firmly back in Athens’ court and the consensus that a bailout deal will eventually be done is starting to fray a little.

After a ‘deal’ was struck among Greek political leaders on Thursday, euro zone finance ministers in Brussels took one look at Greek Finance Minister Evangelos Venizelos’ figures and promptly told him to go back to Athens and do more.

With trust and goodwill in increasingly short supply, Jean-Claude Juncker, the chairman of the Eurogroup, laid down three demands: a further 325 million euros in spending cuts, approval of the package by the Greek parliament, and a written commitment from the leaders of Greece’s parties that they would stick to the deal beyond April elections.

“In short, no disbursement before implementation,” he said after six hours of talks that diplomats described as pointed.

The immediate concern is that the Greek parliament, which will debate the package on Sunday, could turn it down, reflecting the rising anger of voters, the fact strikes are crippling the nation and political will is rapidly waning.

“I am asking every well-disposed European: when you are in a fifth year of recession, when your country is faltering and its social cohesion is at risk, can the only antidote to the crisis be even higher unemployment and two more years of recession?” Antonis Samaras, leader of the conservative opposition, whose party is ahead in the polls, told supporters on Thursday.

“We should show the Europeans that what is happening in Greece will soon spread to the rest of Europe if we do not change the policy of endless austerity.”

BRUSSELS, Feb 7 (Reuters) – For two years, European officials have wrestled with Greece to try to save the country from financial ruin. Yet the closer talks get to a definitive deal, the greater the risk seems to get that negotiations might collapse once and for all.

Deadlines have come and gone, as have rescue packages, but now there is a firm one. Greece will be unable to meet massive bond payments on March 20 without more aid.

A first, 110-billion-euro plan was put together in May 2010, only to prove insufficient as Greece’s situation worsened. A second, 130-billion-euro deal was agreed last October, but is yet to be finalised despite drawn-out, high-pressure negotiations that have left nerves and tempers frayed.

So many moving parts now need to come together at a single moment to clinch the deal that the danger of one piece being out of place and scuppering the whole enterprise has never been greater.

“They are dancing on a razor’s edge,” said Janis Emmanouilidis, a senior analyst at the European Policy Centre in Brussels who has written extensively on the debt crisis.

“Time is now really, really short. The further the crisis develops, the more intense these moments become. If something goes wrong, and that’s becoming increasingly possible, at some point it could all not work out, with whatever consequences.”

Emmanouilidis, a German-speaking Greek who in that respect straddles the poles of Europe’s debt debacle, thinks it will work out in the near-term, with Greece’s political leaders reaching a last-minute accord with the EU and IMF.

BRUSSELS (Reuters) – Euro zone countries are trying to finalize a second Greek rescue package by the start of March to save the country from default despite repeated delays in decision-making by Athens, EU officials said on Monday.

Europe’s policymakers want the EU/IMF aid deal to be nailed down quickly and are frustrated with Greece’s political leaders who on Monday said they needed yet another day to consider the package’s painful conditions.

EU officials have set a timetable to approve the 130 billion euros in aid in early March, around the time of a summit of EU leaders and shortly after the expected completion of a bond swap with Greece’s private creditors.

The timing is tight and delays have already occurred. A meeting of euro zone finance ministers to start technical preparations was expected on Monday, but is now not likely to happen until later this week, depending on when long-delayed decisions are taken in Athens.

That pushes back the preparatory work, including a formal request that must be made to countries to pledge guarantees to the EFSF, the rescue fund that will be used to help Greece. Officials expect all preparations and the execution of the bond swap with creditors to last at least three weeks.

“There’s no time left to get a comprehensive package ready by the next Eurogroup meeting, so essentially the deadline is going to have to be the leaders’ summit on March 1,” one EU diplomat said.

Patience is wearing thin.

BRUSSELS (Reuters) – Euro zone finance ministers aim to agree a second financing package for Greece on Monday, a decision they hope will boost market confidence in euro zone public finances and help contain the two-year-old sovereign debt crisis.

A deal for Greece would include agreement on official new financing, the size of voluntary losses banks and other private bondholders are willing to accept and new reforms Athens must undertake.

This would end months of uncertainty over private sector losses on Greek bonds and over the sustainability of the country’s debt, now at 160 percent of GDP, which have increased costs of borrowing in many other euro zone countries.

Senior euro zone officials are expected to meet on Monday between 0800 and 1400 GMT (3 a.m. and 9 a.m. EST) in Brussels to prepare the package, which would then likely be submitted for approval by euro zone finance ministers at an extraordinary meeting at 1600 GMT.

“We are very far in the negotiations and we should be able to close them in the coming days,” EU Economic and Monetary Affairs Commissioner Olli Rehn told reporters in The Hague.

“We are negotiating a second program for Greece. The ball is now in the Greek court to agree to do its job concerning the prior actions,” Rehn said, referring to Greek reforms.

EU leaders agreed in October they would lend Greece another 130 billion euros, assuming investors would forego half of what Greece owes them in nominal terms. But talks on the terms of those losses – called private sector involvement or PSI – have moved on since then and the chief executive of Deutsche Bank said bondholders were now ready to lose 70 percent of the net present value of their investment.

BRUSSELS, Feb 2 (Reuters) – Euro zone finance ministers aim to agree a second financing package for Greece on Monday, a decision they hope will boost market confidence in euro zone public finances and help contain the two-year-old sovereign debt crisis.

A deal for Greece would include agreement on official new financing, the size of voluntary losses banks and other private bondholders are willing to accept and new reforms Athens must undertake.

This would end months of uncertainty over private sector losses on Greek bonds and over the sustainability of the country’s debt, now at 160 percent of GDP, which have increased costs of borrowing in many other euro zone countries.

Senior euro zone officials are expected to meet on Monday between 0800 and 1400 GMT in Brussels to prepare the package, which would then likely be submitted for approval by euro zone finance ministers at an extraordinary meeting at 1600 GMT.

“We are very far in the negotiations and we should be able to close them in the coming days,” EU Economic and Monetary Affairs Commissioner Olli Rehn told reporters in The Hague.

“We are negotiating a second programme for Greece. The ball is now in the Greek court to agree to do its job concerning the prior actions,” Rehn said, referring to Greek reforms.

EU leaders agreed in October they would lend Greece another 130 billion euros, assuming investors would forego half of what Greece owes them in nominal terms. But talks on the terms of those losses – called private sector involvement or PSI – have moved on since then and the chief executive of Deutsche Bank said bondholders were now ready to lose 70 percent of the net present value of their investment.

BRUSSELS, Jan 30 (Reuters) – The leaders of the EU’s largest economies were all smiles and warm handshakes at the start of their first summit of 2012, with none of the acrimony that marked their last meeting in December, when the debt crisis was threatening to engulf them.

But the goodwill and good intentions barely masked the political cracks running under the surface.

Ahead of the meeting, German Chancellor Angela Merkel, French President Nicolas Sarkozy and Italian premier Mario Monti met privately for 30 minutes, with the three sharing a joke as they emerged to walk into the summit room side-by-side.

If that wasn’t enough of a show of unity, Britain’s David Cameron made a point of going over to shake Sarkozy’s hand as television cameras rolled, perhaps hoping to put to bed the bad blood that tainted the last summit on Dec. 9, when Sarkozy avoided Cameron after a dispute over new fiscal rules.

But the bonhomie and sense of detente did not last long, with the British and French leaders quickly at odds, Spain and others raising concerns about an excessive focus on austerity, and several east European countries, led by Poland, unhappy about not being fully included in euro zone summits despite signing up to a fiscal treaty enshrining tough debt rules.

At separate news conferences afterwards, Cameron and Sarkozy repeatedly referred to each other by their first names, appearing at pains to dispel any sense of tension or discord.

But on everything from the new treaty on tighter fiscal rules – which only Britain and the Czech Republic of the EU’s 27 countries won’t join – to a financial transactions tax, a single EU patent and industrial policy, London and Paris were at odds.

BRUSSELS, Jan 30 (Reuters) – European leaders will struggle to reconcile austerity with growth on Monday at a summit due to approve a permanent rescue fund for the euro zone and put finishing touches to a German-driven pact for stricter budget discipline.

Officially, the half-day summit is meant to focus mainly on ways to rekindle growth and create jobs at a time when governments across Europe are having to cut public spending and raise taxes to tackle mountains of debt.

But disputes over the limits of austerity, and about Greece’s unresolved debt restructuring negotiations with private bondholders, may sour efforts to send a more optimistic message that Europe is getting on top of its debt crisis.

The risk premium on southern European government bonds rose and stocks were lower on concerns about a lack of tangible progress in the Greek debt talks and gloom about Europe’s economic outlook.

Highlighting those fears, Spain’s economy contracted in the last quarter of 2011 for the first time in two years and looks set to slip into a long recession.

Italy, rushing through economic reforms under new technocrat Prime Minister Mario Monti, was rewarded with a significant fall in its borrowing costs at an auction of 10- and 5-year bonds on Monday, despite double-notch downgrades of its credit rating by Standard & Poor’s and Fitch this month.

But Portugal’s slide towards becoming the next Greece - needing a second bailout to avoid chaotic bankruptcy – gathered pace as banks raised the cost of insuring government bonds against default and insisted the money be paid up front instead of over years. On Monday it cost a record 3.9 million euros ($5.12 million) to insure 10 million euros of Portuguese debt.

BRUSSELS (Reuters) – EU leaders will sign off on a permanent rescue fund for the euro zone at a summit on Monday and are expected to agree on a balanced budget rule in national legislation, with unresolved problems in Greece casting a shadow on the discussions.

The summit – the 17th in two years as the EU battles to resolve its sovereign debt problems – is supposed to focus on creating jobs and growth, with leaders looking to shift the narrative away from politically unpopular budget austerity.

The summit is expected to announce that up to 20 billion euros ($26.4 billion) of unused funds from the EU’s 2007-2013 budget will be redirected toward job creation, especially among the young, and will commit to freeing up bank lending to small- and medium-sized companies.

But discussions over the permanent rescue fund, a new ‘fiscal treaty’ and Greece will dominate the talks.

Negotiations between the Greek government and private bondholders over the restructuring of 200 billion euros of Greek debt made progress over the weekend, but are not expected to conclude before the summit begins at 9:00 a.m. EST.

Until there is a deal between Greece and its private bondholders, EU leaders cannot move forward with a second, 130 billion euro rescue program for Athens, which they originally agreed to at a summit last October.

Instead, they will sign a treaty creating the European Stability Mechanism (ESM), a 500-billion-euro permanent bailout fund that is due to become operational in July, a year earlier than first planned. And they are likely to agree the terms of a ‘fiscal treaty’ tightening budget rules for those that sign up.

BRUSSELS, Jan 30 (Reuters) – EU leaders will sign off on a permanent rescue fund for the euro zone at a summit on Monday and are expected to agree on a balanced budget rule in national legislation, with unresolved problems in Greece casting a shadow on the discussions.

The summit – the 17th in two years as the EU battles to resolve its sovereign debt problems – is supposed to focus on creating jobs and growth, with leaders looking to shift the narrative away from politically unpopular budget austerity.

The summit is expected to announce that up to 20 billion euros of unused funds from the EU’s 2007-2013 budget will be redirected towards job creation, especially among the young, and will commit to freeing up bank lending to small- and medium-sized companies. and

But discussions over the permanent rescue fund, a new ‘fiscal treaty’ and Greece will dominate the talks.

Negotiations between the Greek government and private bondholders over the restructuring of 200 billion euros of Greek debt made progress over the weekend, but are not expected to conclude before the summit begins at 1400 GMT.

Until there is a deal between Greece and its private bondholders, EU leaders cannot move forward with a second, 130 billion euro rescue programme for Athens, which they originally agreed to at a summit last October.

Instead, they will sign a treaty creating the European Stability Mechanism (ESM), a 500-billion-euro permanent bailout fund that is due to become operational in July, a year earlier than first planned. And they are likely to agree the terms of a ‘fiscal treaty’ tightening budget rules for those that sign up.