Greece should complete talks by the end of the week with inspectors from the EU and IMF on a medium-term budget plan plus a vital next slice of international aid, sources close to the negotiations said on Wednesday.
With Athens fighting to avoid defaulting on its debt, the country's central bank chief dismissed as "improbable and ridiculous" any suggestion that Greece might ditch the euro and return to its drachma national currency.
Inspectors on the "troika" team from the European Union, IMF and European Central Bank are in Athens to decide whether to release a tranche of 12 billion euros this month to keep Greece afloat. Partly due to IMF demands, discussions on a new package that would meet Greece's needs up to 2014 are also taking place. Asked when the review would be concluded, one source said: "Tomorrow if we are lucky, but it could also be Friday."
A German finance ministry spokesman said Berlin expected the troika to report on Friday evening at the earliest and that Germany expected the EU and International Monetary Fund to remain involved jointly in any continued aid programme.
Sources said that whether Athens gets the fifth tranche of aid under its existing 110 billion euro EU/IMF bailout will depend on senior EU finance officials who are gathered in Vienna and on eurozone finance ministers, who may meet earlier than their next scheduled talks on June 20.
European officials are holding talks in the Austrian capital to sketch out options for a second bailout package, with private sector participation still under discussion to help relieve the country of its massive debt burden.
A Greek source with knowledge of the Athens negotiations was optimistic that Greece would get the latest slice of money to cover its budget deficit and meet debt repayments.
A new package for Greece, expected to total around 65 billion euros according to EU officials, could involve a mixture of collateralised loans from the EU and International Monetary Fund, and additional revenue measures.
It could involve unprecedented intrusive external supervision of the privatisation programme, which has yet to sell anything since the rescue a year ago.
However, a European source said the troika's remit did not include plans for a privatisation agency modelled on one which sold East German state enterprises after the fall of communism.
Greece's plight has prompted some comment that it should leave the euro zone rather than continue spreading its problems to other countries in the bloc through market "contagion".
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