Prime Minister Antonis Samaras will call for a two-year extension to Greece's austerity programme when he meets Angela Merkel and Francois Hollande next week, the Financial Times reported on Wednesday. Samaras will suggest that public spending cuts be spread over four years instead of two to help the plunging Greek economy return to growth during the talks with the German chancellor and French president, according to a document seen by the newspaper. The Greek prime minister is to meet in Athens on Tuesday with the head of eurozone finance ministers, Jean-Claude Juncker, before travelling to Berlin to meet with Merkel next Friday and with Hollande in Paris on Saturday. Greek officials were not immediately available for comment as Wednesday was a public holiday. But Merkel's spokesman Steffen Seibert said that the German position on Greek reforms remains unchanged. "Of course the chancellor will listen to what Mr Samaras has to say here about the situation in Greece and the implementation of the programme," he told a regular government news conference in Berlin. "But for the entire German government, the agreed memorandum of understanding which states what the Greek obligations are remains the basis of all aid decisions." Greece's government is currently scrambling to find budget cuts -- amounting to 11.5 billion euros ($14.2 billion) or around five percent of GDP -- to be implemented in 2013 and 2014 as part of its existing bailout deal with the European Union and International Monetary Fund. Samaras has made it known since before taking office in June that he favours spreading out the spending cuts demanded by Greece's international creditors, the European Union and International Monetary Fund. Greek officials have long argued that the magnitude of the cuts demanded in exchange for bailout loans risk pushing the country into such a vicious circle of recession that it won't be able to meet its reform targets. Preliminary figures show that the Greek economy contracted by 6.2 percent in the second quarter and expectations are now that it will fall by seven percent overall this year -- its fifth year of recession. According to the FT the Greek government would need an additional 20 billion euros to cover the budget shortfall in case spending cuts are spread out over an additional two years. It would not ask the EU for additional bailout funds but would seek to delay beginning repaying rescue loans from 2016 to 2020, tap an existing IMF loan and issue additional short-term treasury bills, said the newspaper. Finding the 11.5 billion euros in unpopular cuts has caused strains in Greece's new coalition government, with only about two-thirds of the amount agreed. With unemployment already at 23.1 percent, the government is reluctant to carry out job cuts or send public workers on temporary furloughs. The spending cuts are key to unlocking the next installment of EU-IMF bailout loans, which crucial for the Greek government to stay afloat. Back-to-back elections in May and June threw its reform programme off track, with the next installment of bailout loans of nearly 31.5 billion euros is not expected before October. In order to avoid an impending cash crunch the government made on Tuesday its biggest sale of short-term debt since taking its first bailout in 2010, raising 4.1 billion euros in three-month treasury bills. Greece has been shut out of the long-term debt markets since 2010, but has regularly issued small amounts of short-term debt. Former German chancellor Gerhard Schroeder urged Berlin to show more solidarity with Greece during an interview with the Greek public television channel Net. "Germany has proven its solidarity" with Greece, "but I was hoping for more," Schroeder said in comments from the southeastern Greek island of Kos, where he said he was on holiday to show support for Greeks. "If Greece moves forward with its reforms, it must be given more time," the former German leader added in comments translated into Greek.
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