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Greece Struggles to Gain Support for Austerity Measures

Greece Struggles to Gain Support for Austerity Measures

Just a few hours after Greece abandoned its anti-austerity stand and accepted tough conditions to try and secure another bailout, the country’s leaders struggled on Friday to rally domestic support for its swift reversal while influential figures in Germany and Eastern Europe remained skeptical on whether Greece would really honor pledges to be more responsible fiscally.

With an approaching Sunday deadline on whether to cut the nation adrift, a crunch point that all parties view Greece’s last opportunity to avoid bankruptcy and remain in the euro, the chances of a deal looked to be less focused on the precise details of the country’s offer than political calculations in Athens, other European strongholds and the headquarters of the European Union, Brussels.

The new proposals tabled by Prime Minister Alexis Tsipras, which significantly match those rejected in last Sunday’s Greek referendum, were given swift nods by France, raising hopes in Brussels, that after months of ill-tempered discussions and futile crisis meetings, the Greek government and its creditors could arrive at a deal by midnight on Sunday to avoid the fracturing of the euro.

The objective is not sealing an agreement that would immediately offer Greece fresh funding, but simply obtaining a formal green light to begin what could be very long negotiations on a new bailout plan for replacing the one that expired on June 30. The go-ahead to start talks could at least temporarily wipe away the dark cloud of uncertainty and give a basis for the European Central Bank to perhaps open the recently frozen emergency cash for Greek banks, which have remained shut since June 29.

Considering the different actors who will take part in the Sunday crisis meeting in Brussels- 19 eurozone finance ministers, 28 European Union leaders, bureaucracies of the union- and lots of bad blood castigated by months of insults, frustrations and failure, the chances of a final agreement are still quite slim, despite the pledges made by the Greek government to implement measures like tax increment and pension cuts.

The assessments of the representatives of the main creditors; the IMF, the European Central Bank and European countries that use the euro will play a pivotal role in any decisions that will be made by the Euro group, an assembly of finance ministers from euro-using nations, in their meeting which is scheduled for Saturday in Brussels.

Reports from the Friday meeting reveal that it was quite tense due to the serious objections among legislators over the additional austerity measures outlined in the proposals.

Addressing members of Syriza in the parliament building on Friday, the Greek Prime Minister, Mr. Tsipras said that his government has a ‘’mandate from the Greek people to bring a better government’’ but ‘’we do not have a mandate to remove the nation from the Eurozone,’’ a move that would impact a decisive fallout with creditors.

Ref: http://www.nytimes.com/2015/07/11/world/europe/greece-struggles-to-rally-support-for-its-proposals.html?_r=0

 

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