Greek police clashed with stone-hurling youths and thousands protested against austerity in Athens on Wednesday as EU and IMF envoys began talks with the government on stepping up fiscal reforms, Reuters reported. After bailing out Greece one year ago, European governments have concluded that additional aid may be necessary as Athens struggles to meet its economic targets and win back the confidence of investors, who now believe it will eventually have to restructure its debt mountain. EU finance ministers will discuss the Greek crisis next week but are not expected to decide on any new support measures until the mission that began on Wednesday gives its verdict on progress on reforms. A euro zone source told Reuters that the ministers were likely to tell Greece it must deliver on savings and privatisation targets already agreed if it wants new emergency financing next year. "There will be debate on Greece next week. No decision will be taken," Joerg Asmussen, Germany's deputy finance minister said. The euro had risen on Tuesday on a report, later denied, that a new 60 billion euro rescue for Greece was on the cards. But it fell back to $1.4225, a three-week low, on Wednesday amid doubts that Europe would provide timely aid to both Greece and Portugal. In a positive sign for Portugal, Finland's Prime Minister-elect Jyrki Katainen said he had clinched a deal with the country's number two party, the Social Democrats, to back a bailout for Lisbon. That came after Finland's eurosceptic True Finns party had vowed to vote against the aid package in parliament, a key hurdle for the bailout. The EU/IMF mission to Greece will focus on a 2011-2015 fiscal plan and on Greek progress in raising 50 billion euros from privatisations. Markets are braced for some form of debt restructuring in the long-run as Greece labours under a 327 billion euro debt mountain. Ten-year Greek bonds currently change hands at around 55 percent of their face value, carrying a secondary market yield of 15.7 percent. They were little changed on Wednesday but up more than 3 percentage points since the start of the year.
