SALON

Wednesday, Jul 18, 2012 2:45 PM UTC

Greeks promised no more austerity in 2012

By

Topics: From the Wires,

Greeks promised no more austerity in 2012Protesters chant slogans in support of striking steel workers outside the Labor Ministry building in Athens, on Tuesday, July 17, 2012. Several hundred people took part in the protest, organized by a Communist labor union, which came as the Greek government is seeking to end a nine-month standoff between strikers and management at a steel plant outside Athens. (AP Photo/Thanassis Stavrakis) (Credit: AP)

ATHENS, Greece (AP) — Greeks will be spared new austerity measures this year, parties backing the coalition government promised on Wednesday, though they refused to rule out more painful cuts starting in 2013.

Leaders of three parties met to try and hammer out details of a new round of cuts worth €11.5 billion ($14.1 billion) demanded by international rescue creditors over the years 2013 and 2014. They also sought ways to better deal with this year’s deficit-cutting targets, which are slipping away.

Conservative Prime Minister Antonis Samaras met with leaders of the Socialist party and small Democratic Left party after five days of Cabinet-level talks failed to produce sufficient cuts.

When Samaras won the June 17 election, ending months of political uncertainty, he promised to renegotiate the country’s bailout terms, which include tough deficit-cutting measures. But he could be forced to eventually slash public benefits further to help cover the €11.5 billion in budget savings.

The party leaders promised to give weary Greeks a break, however.

“We decided that there will be no new (austerity) measures in the year 2012,” Democratic left leader Fotis Kouvelis said after the meeting, though Finance Minister Yannis Stournaras refused to rule out more budget cuts next year.

Kouvelis said the government’s financial plans will be completed in coming days.

“There will be a comprehensive proposal to request a renegotiation” of the country’s bailout terms, he said. Greece would ask for more time to meet its deficit targets.

Debt inspectors from the European Union, European Central Bank and International Monetary Fund — known as the troika — are due to return to Athens next week.

In Germany, the country’s Finance Minister Wolfgang Schaeuble said European rescue creditors would await the troika’s report on Greece before taking any decisions.

“(For Greece) serious and far-reaching adjustment measures are needed in many areas,” he told the German newspaper Rheinische Post, in an interview published Wednesday.

Debt-strapped Greece has seen a rapid rise in poverty and unemployment since the start of the crisis in late 2009 and is stuck in a fifth year of recession as it survives on billions of euros in emergency loans from the IMF and other Eurozone countries.

In a report this week, the IMF warned that Greece’s program to make its national debts and deficit sustainable remain at risk of failing.

“The recent deterioration in the political and economic climate in Greece serves as a warning about the potential onset of ‘adjustment fatigue,’ which remains a threat to continued program implementation,” the report said. “The situation in Greece remains fluid.”

A deepening in the recession and uneven success in reforming the economy have hurt government revenues this year, the IMF noted.

___

Online:

IMF Fiscal Monitor: http://www.imf.org/external/pubs/ft/fm/2012/update/02/pdf/0712.pdf

More Derek Gatopoulos.

Next Article

Related Stories

More Related Stories

Featured Slide Shows

The week in 10 pics

close X
  • Share on Twitter
  • Share on Facebook
  • Thumbnails
  • Fullscreen
  • 1 of 11
  • Lisa Montgomery embraces her nephew Thursday after a tornado tore apart her home in Cleburne, Texas. The twister killed six people and destroyed entire swaths of the North Texas town.
    Credit: AP/LM Otero

  • Jack McMahon, the defense attorney for abortion doctor Kermit Gosnell, speaks outside the Criminal Justice Center in Philadelphia Tuesday. His client was convicted of killing three babies in his clinic, and will serve multiple life sentences.
    Credit: AP/Matt Rourke

  • A photo taken Monday captures Vice President Joe Biden's response to a Milwaukee second-grader's innovative proposal to end America's epidemic of gun violence. This guy!
    Credit: AP/Jenny Aicher

  • Sen. Rand Paul, R-Ky., flanked by a grouper-eyed Michele Bachmann, addresses the IRS' admission that it targeted Tea Party groups in advance of the 2012 election. In an op-ed for CNN Thursday, the Kentucky senator slammed the president for his faux outrage.
    Credit: AP/Molly Riley

  • Ousted IRS chief Steven Miller is sworn in on Capitol Hill Friday. Miller testified before the House Ways and Means Committee on the extra scrutiny the agency gave conservative groups applying for tax-exempt status.
    Credit: AP/J. Scott Applewhite

  • Attorney General Eric Holder pauses as he testifies on Capitol Hill before the House Judiciary Committee Wednesday. Holder is under fire, among other things, for the Justice Department's gathering of phone records at the Associated Press.
    Credit: AP/Carolyn Kaster

  • O.J. Simpson sits during an evidentiary hearing at Clark County District Court in Las Vegas, Nev., Thursday. Simpson, who is currently serving a nine-to-33-year sentence in state prison for armed robbery and kidnapping, is using a writ of habeas corpus to seek a new trial.
    Credit: AP/Las Vegas Review-Journal/Jeff Scheid

  • Major Tom to ground control: On Sunday astronaut Chris Hadfield recorded the first music video from space, a cover of David Bowie's "Space Oddity."
    Credit: AP/NASA/Chris Hadfield

  • When it rains it pours. President Barack Obama speaks during a news conference Thursday with Turkish Prime Minister Recep Tayyip Erdogan, inexplicably inspiring an #umbrellagate Twitter meme.
    Credit: AP/Jacquelyn Martin

  • A smoke plume rises high above a road block at the intersection of County A and Ross Road east of Solon Springs, Wis., Tuesday. No injuries were reported, but the the wildfire caused evacuations across northwestern Wisconsin.
    Credit: AP/The Duluth News-Tribune/Clint Austin

  • Recent Slide Shows

  • Share on Twitter
  • Share on Facebook
  • Thumbnails
  • Fullscreen
  • 1 of 11

Related Videos

Comments

 0 Comments

Comment Preview

Your name will appear as username

You may use these HTML tags and attributes: <a href=""> <b> <em> <strong> <i> <blockquote>

follow salon

Most Read

Popular on Reddit

links from salon.com

vote
Journalists file suit against Manning's trial secrecy: Plaintiffs including Glenn Greenwald and Julian Assange demand press, public access to trial and documents
152 points153 points | comment
vote
Kaitlyn Hunt refuses plea offer, will go to court over high school relationship - The 18-year-old rejected a deal that would have labeled her a sex offender and placed her under house arrest
135 points136 points | 95 comments
vote
Report: Nearly a quarter of Americans struggle to afford food
133 points134 points | 12 comments
vote
Kaitlyn Hunt refuses plea offer, will go to court over high school relationship - The 18-year-old rejected a deal that would have labeled her a sex offender and placed her under house arrest
121 points122 points | 41 comments
vote
Ted Cruz against the world - How the Junior Senator is igniting the GOP civil war
78 points79 points | 19 comments

From Around the Web

Presented by Scribol
listener_new_rect The Listener: Chekhov's story mirrors Russia's own

Recommendations