Financial Crunch: Greek Parliament Okays Bailout Proposals | Independent Newspapers Limited
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Financial Crunch: Greek Parliament Okays Bailout Proposals

Posted: Jul 12, 2015 at 1:19 am   /   by   /   comments (0)

By Ejikeme Omenazu  Lagos(With Agency Reports)

THE Greek parliament on Saturday July 11, 2015 approved the government’s latest economic reform proposals aimed at securing another crucial European Union (EU) bailout.
The proposals detail how the Greek government intends to tackle the country’s debt and avoid a possible exit from the eurozone.

They were backed by 251 of 300 deputies, meaning they can now be presented to the Greece’s creditors as Athens seeks to obtain a new international bailout to stave off financial collapse.
Eurozone finance ministers are gathering in Brussels to discuss the proposals as a weekend of crucial negotiations gets under way.

The measures are seen as a last chance to avert financial collapse, and the reforms have been given an initial green light by the European Union and International Monetary Fund.
In a statement issued after the vote, Prime Minister Alexis Tsipras, said he had a “strong mandate to complete the negotiations to reach an economically viable and socially fair agreement”.

“The priority now is to have a positive outcome,” he added.
The package includes a set of painful tax rises and pension reforms very similar to those rejected by the Greek people in last week’s referendum.

In return, Athens is asking for a €53.5billion (£38.5billion) bailout from the European Stability Mechanism (ESM), the EU organisation that provides financial assistance for eurozone members.
Eurozone sources have said bailout talks are now highly likely after the European Commission, European Central Bank and IMF said the proposals were sufficient basis to start negotiating conditional loans from the ESM.

But two sources close to the talks have told the Reuters news agency the eurozone finance ministers have serious doubts about the bailout request.
The first source said: “The high figures for financing needs over the next three years may be too high and too sudden.”
The second said he put the chances against reaching a deal to open negotiations at 60-40.
An official who spoke to the Associated Press on the condition of anonymity, said creditors are still looking for firmer commitments, tighter deadlines and more urgent action on several issues highlight in the reform package.
Ahead of the parliamentary vote, Tsipras acknowledged they were a far cry from his party’s anti-austerity pre-election promises.

There was a significant show of dissent in the vote – 10 members on the government benches either abstained or voted against the plans, while another seven were absent.
Some have accused Tsipras of “caving in” to the EU after a milder bailout package was rejected in the referendum – at the urging of the government itself.
But, Tsipras said they were the only way for Greece to unlock the funds needed to avoid financial collapse.
Reaction to the offer from around Europe has been largely positive.

Meanwhile, the French President, Francois Hollande, has described the plans as “serious and credible”, but said “nothing was decided yet”.
Germany was more cautious, warning that the outcome of this weekend’s talks remained “completely open”.

Greece has had two bailouts worth €240 billion (£172.5billion) from the eurozone and the IMF since 2010.
However, its economy has shrunk by a quarter, unemployment stands at more than 25 per cent and one in two young people are out of work.
Greek banks are will remain closed until at least Monday and cash machine withdrawals remain limited to €60 (£42) per day.