Friday 9 December 2016

German vote and Greek inspection pile pressure on eurozone

Published 29/09/2011 | 05:00

Pensioners burn bills for a new, one-off income tax in Athens, Greece, yesterday
Pensioners burn bills for a new, one-off income tax in Athens, Greece, yesterday

TODAY will be another important moment in the eurozone crisis as Germany's parliament votes on widening the scope of the European Financial Stability Facility (EFSF) bailout fund, which was first agreed by EU leaders back in July.

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Angela Merkel faces a revolt within her conservative camp and may have to rely on support from the opposition Social Democrats and Greens to get the measure approved, damaging her authority.

In Greece, EU and IMF inspectors are due to return to Athens to decide whether the government there has done enough to secure a new batch of aid vital to avoid bankruptcy.

Yesterday, European Commission president Jose Manuel Barroso described the on-going crisis as a "baptism of fire" for his generation. "We are at a crucial moment in history because if we do not move forward with more unification, we will suffer fragmentation," he added in a speech that called for a tax on financial transactions.

The tax proposal and continued uncertainty helped push down shares yesterday with markets everywhere showing jitters.

The French government confirmed, meanwhile, it would increase tax by 3pc on salaries over €500,000.

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