Greece could use 'Zambia' option as progress on deal unclear

ATHENS, Greece (AP) - Greece and rescue lenders remained at odds over whether the two sides are close to a breakthrough in negotiations, as the International Monetary Fund confirmed Thursday that Athens had the right to ask for "bundled" repayments next month.

"Countries do have the option of bundling when they have a series of payments in a given month ... making a single payment at the end of that month," IMF spokesman William Murray said in Washington.

He said Athens hadn't made a request to combine repayments, adding that the last country to do so was Zambia three decades ago.

Greece has warned it may be unable to repay an IMF loan due on June 5 unless it reaches a deal with emergency creditors to unlock remaining bailout funds. It has four IMF repayments due next month, through June 19.

In Athens, Prime Minister Alexis Tsipras held an hour-long call with German Chancellor Angela Merkel and French President Francois Hollande, according to government officials who remained optimistic a deal was imminent.

"It is based on very specific facts," government spokesman Gabriel Sakellaridis said. "We are going into these negotiations with the aim to have an agreement with our partners by Sunday."

Murray refused to comment on when a deal could be struck, insisting "work still needs to be done" - a note of caution echoed in Brussels.

"Talks will continue in the coming days, and further progress is needed," European Commission spokeswoman Annika Breidthardt said. "We're not there yet. There are open issues which need to be resolved."

The commission is one of the three institutions negotiating with Greece, along with the IMF and European Central Bank.

Tsipras' government, elected in January on an anti-austerity platform, has been in talks for four months on what reforms it should make to get the final bailout installment of 7.2 billion euros ($8 billion) from fellow eurozone states and the IMF.

Creditors insist Athens must take more long-term measures to ensure its economy is reformed and doesn't slip back into the bad habits of the past, with reckless borrowing and a large and inefficient public sector.

Failure to reach an agreement could eventually cause Greece to drop out of the euro, roiling European and global markets.

Greece's conservative opposition criticized the government's handling of the negotiation.

"It is obvious that the government is at a dead-end," New Democracy party spokesman Kostas Karagounis said.

"It announces deals that don't exist, it presents its own positions as agreements, it is refuted by all foreign officials and meanwhile time has run out and the money has been exhausted."

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