Protesters gesture as they hold a banner with an EU flag and swastika in the center during a peaceful rally for a sixth day, attended by thousands called through a social networking site – modeled on protests by young people in Spain, on Monday, May 30, 2011. (Photo: AP0

BRUSSELS, Belgium

European officials are locked in a heated debate over whether — and how — to give more aid to debt-ridden Greece just as a much-delayed examination of the country’s finances draws to a close.

Experts from the European Union, the European Central Bank and the International Monetary Fund will likely conclude their review of Greece’s accounts and austerity program over the next 24 to 48 hours, a European official said Tuesday.

Their report is set to show huge funding gaps in Greece’s budget over the next two years, despite 110 billion euros (US$157 billion) in rescue loans granted only a year ago. It will also spell out new austerity measures and detail plans to privatize public real estate and corporate assets as the Greek government struggles to hit deficit targets set out in the bailout program.

In parallel to the review carried out in Athens, European governments and financial institutions are wrangling over different proposals that would make potential new loans to the struggling country more secure.

So far there is no consensus among eurozone countries on whether to give Greece new aid and how, the official said, despite increased pressure in recent days from the European Commission, the ECB and other financial leaders.

“It’s really very chaotic,” a second European official said of the talks between representatives from eurozone finance ministries, the ECB and the EU. “There are loads of proposals but all proposals are opposed by some.”

Both officials were speaking on condition of anonymity because discussions were still ongoing.

Many of the richer countries in the 17-nation eurozone are frustrated with Greece’s slow implementation of the economic reforms and some 50 billion euros in privatisations that were supposed to help its economy grow again and cut down a national debt of some 150 per cent of economic output. They want assurances that they will get their money back as their own taxpayers are unhappy with what they see as undeserved help for less disciplined countries.

The ministry representatives, who will meet again Wednesday in Vienna, are discussing potential “technical assistance” for Greece in tax collection and the privatization program, the two officials said. Such international involvement in the internal financial affairs of a eurozone country would constitute an unprecedented intervention likely to face strong opposition within Greece.

On top of that, some countries have pushed for Greece to provide collateral for any further loans which could be cashed in if the government fails to repay the aid.

Earlier this month, European policymakers also raised the possibility of asking private creditors like banks and investment funds to give Greece more time to repay its bonds, but such a move has been strictly opposed by the ECB.

ECB officials have warned that even such a “soft restructuring” or “reprofiling” could be seen by investors as a default, triggering panic on financial markets similar that seen after the collapse of Lehman Brothers.

Despite those concerns, the two officials said that asking private investors to extend the maturities of the bonds they hold was still on the table.

Any final agreement on new aid will depend on which of the countries and institutions will give in eventually and would have to be hammered out by finance ministers in June, one of the officials said. In addition to a scheduled get-together on June 20, there is a “strong likelihood” of a special meeting the week before that, he added.

Eurozone governments expect Greece to come up with new measures that will help it cut its deficit to the three per cent of economic output allowed under EU rules by 2014. Last year, it posted a deficit of 10.5 per cent and at the current rate the EU estimates it will have a funding shortfall of some 9.5 per cent this year, two percentage points above target.

Any new aid would not relieve Greece from implementing the painful and unpopular austerity and reform measures but only give it more breathing space by keeping it out of international debt markets for a little longer.

Greece was supposed to raise some 27 billion euros next year and a similar amount in 2013 to start covering some of its bills again, but with interest rates for 10-year bonds above 16 per cent that prospect now seems unrealistic.