Greece told to cut deeper

David Hellier
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EUROPEAN ministers told Greece yesterday it may need to take further steps to bring a swollen debt under control and calm “irrational” financial markets, as wage cuts already announced by Athens sparked another strike.

At a European Union meeting, finance ministers from Germany, Austria and Sweden led the charge, with Germany’s deputy finance minister saying Greece should mimic Ireland and Latvia, both of which are slashing spending and wages savagely.

“We made it clear the ball is in Greece’s court,” said Joerg Asmussen. “Additional measures by Greece are needed.”

That, and a statement issued by the ministers after the meeting, suggested clearly that the 30 days they have given Greece to prove itself before reporting back will in any case end with demands for more budget cuts or tax hikes, or both.

Meanwhile, the Greek authorities have been given just days to explain its use of financial deals that it used to mask debt.

Goldman Sachs, Deutsche Bank and a number of other investment banks have been involved in deals for Greece over the past decade that have attracted political interest since the crisis arose.