Friday, November 24, 2017

Greece’s plea: No more austerity under the bailout deal

By on February 16, 2017

Firefighters as reflected on a firefighter helmet during a protest outside parliament amid a contract dispute with the cash-strapped government, in Athens on Thursday, Feb. 16, 2017. The government says it is lacking the funds needed to offer thousands of firefighters long-term contracts. Greece is under pressure to make deeper spending cuts as it struggles to reach agreement with bailout lenders on the terms of future loan payouts. (AP Photo/Thanassis Stavrakis)

Firefighters as reflected on a firefighter helmet during a protest outside parliament amid a contract dispute with the cash-strapped government, in Athens on Thursday, Feb. 16, 2017. (AP Photo/Thanassis Stavrakis)

ATHENS, Greece – Greece’s economy has met its budget targets and there is therefore no reason for further austerity measures to be imposed as part of a deal with bailout creditors, the government spokesman said Thursday.

Greece has been struggling for months to conclude negotiations with its creditors on spending cuts and reforms demanded by European creditors and the International Monetary Fund as part of its third bailout program. It hopes to reach an agreement in time for a Monday meeting of eurozone finance ministers.

Government spokesman Dimitris Tzanakopoulos noted the country had exceeded its bailout targets for the primary surplus – the budget excluding interest rates – and therefore no further austerity should be imposed on the Greek people.

A deal should be reached “without additional burdens, without additional cost for Greek society,” Tzanakopoulos said. “Our aim, therefore, continues to be for a deal without a single euro’s worth of additional austerity measures.”

Greece has relied on billions of euros from international rescue loans since 2010. In return for the bailouts from the IMF and other eurozone countries, successive governments have had to push through deeply unpopular reforms, increasing taxes and slashing spending, including on pensions and salaries.

Without an agreement, Greece will not be able to tap into the next installment of bailout funds, and it faces a debt repayment hump in July.

Athens insists the problems in its negotiations stem from the intransigence of some of its creditors.

“The key to there being a positive development on Feb. 20 remains the return to reality both by the IMF and by Germany’s finance ministry,” Tzanakopoulos said. Athens has long maintained the IMF’s predictions for the Greek economy are too pessimistic, and Germany’s demands for high primary surpluses too harsh.

The IMF should “finally adopt the reality of the figures for the Greek economy’s performance until now and make more reliable and realistic predictions for the following years,” Tzanakopoulos said. “We also expect the German Finance Minister to have more realistic assessments about the size of primary surpluses in the mid-term.”

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