Lawmakers in Greece are taking the decision of whether to accept the conditions of a fresh bailout from the European Union right down to the wire. Greek Prime Minister Lucas Papademos said he expected the leaders of Greece's three ruling parties to reach a decision by noon local time Monday.

Lenders from the European Union, the European Central Bank, and the International Monetary Fund have demanded spending cuts in Greece as prerequisites for a 130 billion euro ($171 billion) bailout that would save Greece from defaulting on its debt. The deal would also see part of Greece's debt erased by private lenders.

Negotiations between Papademos and the leaders of the three parties lasted five hours on Sunday but the politicians were unable to reach an agreement.

"The political leaders must give their response in principle by noon tomorrow, so that it can be taken to the Euro Working Group in Brussels," said Panos Beglitis, spokesman for one of the parties, PASOK, on Sunday evening.

Jean-Claude Juncker, who chairs the Eurogroup of eurozone finance ministers, told the German news magazine Spiegel on Sunday that Greece cannot expect "others to show solidarity" unless it's pulling its weight as well.

"If we were to establish that everything is going wrong in Greece, then there would be no new program, and that would mean that in March they would face bankruptcy," Juncker said. The prime minister of Luxemburg also said this prospect should motivate the Greek people and government to raise their game.

Balancing act

The three parties did agree that spending in 2012 would be cut by 1.5 percent of Greece's gross domestic product, but where these cuts would come from remains up for debate. They are struggling to find a balance between various measures, including wage cuts, changes to pension plans, and partial privatization of banks.

Labor unions have warned that wage cuts would only deepen Greece's four-year recession.

"They are asking us for further austerity which the country cannot handle. I am fighting to prevent this," said New Democracy leader Antonis Samaras after Sunday's meeting.

The leader of the LAOS party, Giogos Karatzaferis agreed, saying "I am not going to contribute to a revolution that will humiliate us and that will cause the destruction of Europe."

Some economists believe that if Greece defaults on its debt, a domino effect would mean the rest of the eurozone was also affected, with the fate of the euro itself possibly at stake.

mz/slk/ncy (AP, AFP, Reuters)