thats why he takes his gun out about half way through the conversation....
Greedo trys to bargin with Han and when Han realizes that nothing he says is going to get him out of the situation he decides to take action...
now from a story telling point of view it wouldnt make sense for Greedo to just shoot out of nowhere..
Lucas was taking ideas from old Western movies and whatnot when he made this...
so he gives us a confrontation, we know our character is doomed.... and instead of having it over in 1 second he makes is suspensful...
words are exchange, and right before Greedo fries Han.... Han fires and ultimatly the crowd cheers!
It's perfect!!!