Disagreement between institutions and Greece could lead to more measures

Talks at an impasse

After three days of negotiations between the relevant Greek delegations and the country’s creditors no progress has been in the talks. During the first meetings the representatives of the institutions question whether the government can meet the 2017 primary surplus budget target, opening the window of more measures economic measures being implemented. The creditors have have raised serious doubts about the capacity of the Greek government to reach the goal of a budget surplus in 2017, something that would activate a clause on the technical programme that provides for the implementation of additional fiscal measures in the event targets are not met in the budgets of 2017 and 2018. These measures would include cuts in defence spending, reforms in the personal tax revenue and freezing of inflexible expenditure. On the labour front, little progress was made as both sides were entrenched in their positions. Labour Minister Katrougalos reopened the matter collective bargaining in the labour market, but the institutions claimed its reintroduction would be be counterproductive for the economy. Meanwhile. during talks between the social partners and the creditors, it was revealed that the proposal for reducing the minimum wage from 510 Euros to 490 had been tabled by Katrougalos and not the lenders. Finally, there was also disagreement on the matter of the “Social Solidarity Benefit”, as only 570 million Euros have been found for the needs of 900 million to cover benefit.