Greek coalition sets out latest austere budget

City A.M. Reporter
GREECE’S government presented a new austerity package to parliament yesterday as a week of strikes and protests kicked off over proposals that politicians must approve if the country is to secure more aid and stave off bankruptcy.

The process is also complicated by reports that Brussels may not strike a new agreement over Greece’s next tranche of bailout cash next week, as had been expected by observers.

“The 12 November meeting will not be the final stage. We’re not so much under the gun as it may seem,” a senior EU official said yesterday. “A deal is still likely in November, but not necessarily on 12 November.

“There will be no deal until there is a deal on all the different strings of the package. We will not disburse the next tranche until all details are in place,” the official added.

Back in Greece, parliament is expected to vote on Prime Minister Antonis Samaras’s €13.5bn (£10.8bn) package of cost cuts and tax hikes on Wednesday along with measures making it easier for firms to hire and fire workers.

Greece’s powerful main public and private sector unions will launch a 48 hour strike against the legislation today and plan marches in the centre of Athens. Journalists, doctors, transport workers and shopkeepers also plan stoppages.

“We promised to avert the country’s exit from the euro and this is what we are doing,” Samaras said yesterday. “We have given absolute priority to this because if we do not achieve this everything else will be meaningless.”

Without the aid, Greece will not be able to redeem a €5bn treasury bill falling due on 16 November.

The bulk of the new aid tranche, some €25bn, is earmarked to recapitalise Greece’s struggling banks and jump-start moribund lending, a prerequisite to climbing out of recession.