The Minister of Finances Yannis Stournaras and his staff are racing against time to address as many issues as possible by the end of next week, starting with a series of critical meetings with the troika heads. The government’s goal is to collect the one billion euro loan installment from July, but must first address its bailout commitments.

Mr. Stournaras met with the troika’s teams of experts in the morning, before discussing developments with Prime Minister Samaras and Vice President Venizelos at noon. Mr. Stournaras will see the troika heads in his office at 3pm. The biggest problem for the government in this round of talks is the fate of defense industry EAS.

The Greek government wants to split the company into to two smaller operations, with one maintaining export operations and supply of the Hellenic Armed Forces for a year on a trial basis, while the other will shut down. The troika on the other hand doubts the government’s estimations and is in favor of an immediate shit down.

The Ministry of Finances’ plan involves the dismissal of over 700 employees from EAS and ELVO, so that only 341 remain to operate the two factories. The Minister of Administrative Reform Kyriakos Mitsotakis will include these dismissals in the 4,000 he has committed to for 2013, but should there be a problem, rumors suggest “sacrifices” will be made at the Ministries of Finances, Growth, Education, Culture, Administrative Reform, Health, Employment, Agricultural Development, Infrastructure and the Environment.

Aside from the complicated situation with EAS, Mr. Stournaras will also discuss the auctions of primary residences, with the troika suggesting that taxpayers unable to pay a minimum installment to be evicted. The government aims to preserve the 200,000-euro threshold currently in place which protects borrowers.

Mr. Stournaras will have to convince the troika of his plans for the taxation of real estate, since the troika estimates that further taxes or austerity measures will be needed to cover the estimated 400 million euro deficit it predicts will be generated by the new tax. The troika executives also believe that the tax must be collected via DEI, as it has proven to be an effective tax-collection mechanism.

The troika has also requested that the VAT in restaurants be reinstated to the 23% rate, since the six-month experiment resulted in net loses in excess of 200 million euros, despite the government’s claims of the measure’s success. The government plans on unilaterally maintaining the 13% VAT rate.

Regarding employment, the troika will insist on deregulating mass dismissals and drastically reducing insurance contributions for businesses. The government will counter-argue that these measures will have a detrimental effect on the insurance funds and employment.