Greek officials say hopeful of creditor deal

(ATHENS) - Greek officials said on Thursday they were close to a deal with the country's EU-IMF creditors which would win approval for the next slice of eurozone loans next week.

Uncertainty over the outlook for the Greek debt-rescue programme had begun to worry financial markets in the last few days.

"We need one or two more days," Development Minister Costis Hatzidakis told To Vima radio, adding that there was a "pending" discussion over mass civil service layoffs.

"The civil service issue is still pending," Hatzidakis said.

But German Foreign Minister Guido Westerwelle warned the Greeks that turning back on reforms would be a "grave mistake."

"What is important is that the reforms are pursued," Westerwelle, on a visit to Athens, told reporters after meeting with Prime Minister Antonis Samaras.

"The reforms are starting to show an effect. To question them now would be a grave mistake," he said.

Westerwelle had been asked about the possibility of Greece hoping for further debt relief from its European partner -- following a broad debt reduction last year -- once a new government is elected in Germany in September.

But he insisted: "This has nothing to do with elections in Germany."

Greece must axe 4,000 state jobs by the end of the year and relocate 25,000 civil servants to support understaffed parts of its vast bureaucracy.

Efforts to earmark the relevant staff have been going on for months.

But the new minister in charge of the issue, Kyriakos Mitsotakis, told the creditors this week that he needed more time for the necessary cuts.

"The evaluation for mobility is not yet over," Mitsotakis told Skai television earlier this week.

"We need some months to do it right. We cannot enact horizontal measures, I'm not going to take an axe to the issue," the minister said.

A Eurogroup meeting on July 8 will determine whether Greece can draw 6.3 billion euros ($8.2 billion) from its ongoing bailout.

The IMF is also scheduled to decide by the end of July whether to disburse its own scheduled contribution of 1.8 billion euros.

Deputy prime minister Evangelos Venizelos also expressed hopes for a deal after meeting Westerwelle on Wednesday.

"I believe that we will reach a commonly acceptable phrasing and a deal that will allow the smooth disbursement of the loan instalments," said Venizelos, who also holds the foreign ministry portfolio.

Since 2010, the EU and IMF have committed a total of 240 billion euros to the heavily indebted country.