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> Economy

Reuters: Berlin wants to stick to strict austerity, reform-driven plan in Greece

The document shows a difference of opinion between Berlin and Athens

Newsroom February 4 04:59

Berlin wants to see the Greek government back down from its anti-bailout promises and return to the agreed-upon reforms and policies, all signed with its preceding ND and PASOK coalition governments. This “line of defense” is reportedly outlined in a document, according to Reuters, put together prior to the Euro working group meeting on Thursday.

 

According to Reuters, the document says Athens must not back down from the reforms already implemented and those still pending, within the framework of alleviating Greece’s fiscal deficits and a hoped for return to the markets for borrowing.

 

The SYRIZA government is trying to renegotiate the terms of financial support by the Eurozone and the IMF in order to achieve greater independence in its financial policy-making ability, as well as greater leeway to provide a boost to growth.

 

At the same time, the document shows a difference of opinion between Berlin and Athens on whether the EC-ECB-IMF Troika — symbol of reduced sovereignty for many Greeks — should return to the country.

 

Berlin also seems eager for Athens to state that it will respect commitments on repayment of loans to the IMF, the ECB, EFSF and bilateral loans from eurozone countries given to Greece after the first rescue package.

 

A primary surplus goal of 3% of GDP in 2015, 4.5% in 2016 is still on the table, Reuters says, as well as slashing state employees by 150,000, along with pension system system reform, a tight incomes policy and liberalized collective bargaining.

 

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In addition to all of the above, Berlin wants that all privatizations of ports, energy and real estate be carried out in order to raise 2.2 billion euros in 2015. That’s a far cry from the 50 billion euros (!) target once uttered by Troika inspectors in Athens.

 

According to Reuters, there is no clue yet as to the level of European support for Berlin’s positions.

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