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Crunch Greek talks to be delayed

Crucial austerity talks between Greece's coalition party leaders are due to be pushed back for a day despite strong pressure from the European Union for a speedy agreement.

The Prime Minister's office said the delay was to allow completion of separate talks between Prime Minister Lucas Papademos and representatives of Greece's bailout creditors.

Leaders of the three parties in Mr Papademos' coalition publicly oppose steep cuts in private sector pay demanded by the eurozone and International Monetary Fund, but their backing is needed for the government to reach a deal for a massive bailout.

The deal is vital for Greece to avoid bankruptcy next month as it cannot cover a bond repayment due on March 20 without the rescue funds.

Earlier the European Commission said Greece is already "beyond the deadline" to end the talks and should reach conclusions "around now."

Debt-ridden Greece has been kept solvent since May 2010 by payments from an international rescue loan package. When it became clear the money would not be enough, a second bailout was decided last October.

Its implementation depends on the austerity measures but also on separate talks with banks and other private bondholders to take a loss in Greek debt, in exchange for a cash payment and new bonds worth 50 per cent less than the original face value, longer repayment terms and a cut in the interest rate to be paid on the bonds.

-AP

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