Greek parliament passes vital austerity laws
The Greek parliament has voted narrowly in favour of a critical five-year package of harsh austerity measures that will see it secure the next tranche of its international bailout.
Ignoring unrest among Greek citizens, who are rioting in Athens against the reforms, the parliament voted 155-138 in support of prime minister George Papandreou’s Socialist government.
Greece’s government must now win approval on Thursday for legislation detailing specific implementation measures for the €28bn (£25bn) austerity package, but the vote clears a major hurdle in Greece’s bid to win access to international funding to avoid default.
“The country needs the money to make imminent debt payments and to fund wages and pensions. Without it, Greece faces a disorderly default,” said JP Morgan Asset Management global strategist Dan Morris.
“Markets have already rallied in anticipation of a positive vote, with the MSCI EMU index gaining three per cent since Friday and the euro up €0.02 (£0.02) from its recent low against the Swiss Franc.”
Papandreou has also expelled one member of his party that voted against the legislation, taking his parliamentary majority down to 154.
However, a single opposition deputy broke ranks and voted for the package, giving it the 155 vote pass.
The vote now clears the way for the IMF and EU to disburse the next €12bn of Greece’s €110bn bailout, averting a disorderly default for the present.