EU and IMF inspectors head to Greece on unexpected visit

International lenders are making an unexpected visit to Athens after euro zone countries piled pressure on Greece not to backslide on painful reforms that have caused public outrage. News agencies also reported that Eurozone finance ministers are to hold a meeting on July 3rd to discuss a new bailout plan Greece.

The team of European Union and International Monetary Fund (IMF) inspectors will visit as parliament holds a confidence vote tomorrow night on Prime Minister George Papandreou's new cabinet, formed to stiffen resolve behind austerity measures to win new loans and avoid bankruptcy.

Greek government spokesman Ilias Mosialos said they would discuss changes "at a technical level" to a five-year package of spending cuts, tax hikes and public company selloffs that have touched off weeks of strikes and protests.

The new plan almost doubles existing belt-tightening measures that have helped drive unemployment to a record 16 percent and extended a deep recession into its third year.

Mosialos tried to dampen fears of backsliding that have unsettled international markets by saying there would be no change in the economic policy mix in the plan and only improvements in set fiscal targets would be possible.

The inspectors' trip was announced after euro zone finance ministers meeting in Luxembourg on Sunday night delayed approving the next 12-billion euro tranche of aid from Greece's year-old, first bailout, which it needs to remain solvent.

The decision was clearly intended to maintain leverage on Greek lawmakers to both support the new government and push through the new five-year package, which is a condition for a second bailout worth an estimated 120 billion Euros.

"We are waiting for a decision from the Greek parliament. We are calling for not just the government, but the Greek opposition to support the plan," Belgian Finance Minister Didier Reynders said ahead of a second day of meetings in Luxembourg.

Yesterday, opposition leader Antonis Samaras demanded Papandreou quit to pave the way for early elections and a renegotiation of the terms of Greece's current bailout, adding to market uncertainty.

Greek Finance Minister Evangelos Venizelos pledged in Luxembourg to fulfill the plan, saying Greece must urgently restore its credibility.

Protesters planned a big rally tomorrow ahead of the confidence motion and workers at Greek state utility PPC launched a 48-hour strike at midnight yesterday. Athens has agreed to sell state firms to raise 50 billion Euros by 2015 and push through 6.5 billion Euros in budget consolidation for 2011.