Troika Of IMF, EC And ECB In Athens To Assess Latest Greek Budget Shortfall, Next Tranche Of Aid Hangs In The Balance

Greek officials negotiated Tuesday with leaders of the International Monetary Fund, the European Central Bank and the European Commission, collectively known as the Troika, about the size of the country's latest budget deficit.

At the heart of the talks is a difference about the size of the deficit: Athens says it will be smaller than what the Troika is expecting, which -- if true -- would mark significant progress for the euro zone's sickest economy.

“There are growing differences between Athens and the Troika,” a euro zone official told Reuters. “The Greeks are saying: ‘We are doing enough,' and the Troika says they need new steps to close the budget,” he said.

There has been a debate between leaders about a hole in their projected budget for next year. While the Troika had predicted that the country will see a fiscal shortfall of nearly 2 billion euros ($2.7 billion) next year, its leaders contend the difference is merely 500 million euros, and can be closed with changes to the social security system.

Despite the difference of opinion, Greek Prime Minister Antonis Samaras said on a Greek television broadcast that the negotiations would not be adversarial.

“First let me say something – let’s do away with this notion that we are in some kind of war… it is a negotiation,” he said.

Since 2010, Greece has accepted 240 billion euros ($330.5 billion) of bailout money from its European neighbors and the IMF. But the money came with austerity conditions that slowed the economy and put a strain on its people.

Samaras emphasized in the broadcast that Greek officials will not accept any similar measures this time around.

“Society cannot take it, the economy cannot take it, and it is not even required by the country’s current financial situation,” he said.

Unemployment in Greece for 2013 is likely to reach a record high of 27 percent, according to a European Commission report issued Tuesday morning.

It also predicts that Greece’s gross domestic product will contract at a rate of 4 percent this year, but will expand at a rate of 0.6 percent next year. Meanwhile the public debt ratio will peak at 176 percent of GDP this year.

The Athens Stock Exchange fell 0.8 percent Tuesday in its third day of decline.