Saturday 21 January 2017

EU officials turn screws on Greek opposition

Brussels urges politicians to accept new round of belt-tightening as country's crisis deepens

Sarah Collins, in Brussels

Published 09/06/2011 | 05:00

European Commission President Jose Manuel Barroso. Photo: Getty Images
European Commission President Jose Manuel Barroso. Photo: Getty Images

EU officials have urged the Greek opposition leader to accept another round of belt-tightening as his country descends deeper into financial strife, linking any further EU aid to cross-party agreement.

  • Go To

As protests rage in Athens, the EU's top policymakers told Antonis Samaras, the head of the main conservative opposition party Nea Demokratia, that he should sign up to a multibillion-euro programme of spending cuts, tax hikes and privatisations.

"The readiness of the euro area to continue to provide support to Greece depends on a strong and ambitious adjustment programme," European Council president Herman Van Rompuy -- who chairs the quarterly summits of EU leaders -- said in a statement after meeting Mr Samaras in Brussels yesterday. "Efforts to put Greece back on track to a sustainable and credible fiscal path and to economic recovery require all parties to provide broad and constructive political support," he added.

"The Commission strongly believes that a broad political and societal support to the reform measures is critically important for restoring confidence in the future of the Greek economy," said Commission chief Jose Manuel Barroso.

The austerity drive involves shaving an extra €6bn off the budget this year and raising an estimated €50bn by 2015 from the sale of stakes in state companies.

Troika

It has already been signed off by a troika of EU, ECB and IMF officials, but adoption by the Greek parliament is essential before the government can draw down a further €12bn tranche of aid under its €110bn EU-IMF bailout -- essential to pay back a swathe of debt due in mid-July.

EU officials are fearful that beleaguered Socialist premier George Papandreou will fail to secure opposition and popular support for the plan, which he unveiled last month.

Such an outcome could see the IMF refuse to continue to fund Greece under the bailout, leaving eurozone countries on the hook for the balance.

A second rescue for the country is currently being hammered out now that it is certain the Government will not be able to raise its own cash on the markets as planned next year.

The EU insists that any burden sharing should be voluntary, and a spokesman for economics chief Olli Rehn said yesterday there were "several scenarios" still being considered.

Mr Barroso admitted in Strasbourg on Tuesday that there were "risks" of contagion from the Greek crisis that could make it more difficult for Ireland to borrow. Mr Rehn said he hopes to have an agreement on the Greek bailout by the time finance ministers meet in Brussels on June 20, which would be formally signed off at an EU leaders' summit later that week.

Indo Business

Read More

Promoted articles

Editors Choice

Also in Business