Greek counter proposals to troika include harsh austerity measures

Greek counter proposals to troika include harsh austerity measures

Athens, December 2, 2014/ Independent Balkan News Agency

By Lefteris Yallouros

Greek deputy Prime Minister Evangelos Venizelos told a conference Monday that negotiations with lenders would be concluded before parliament elects a new Greek president in February. Venizelos also said the government was not prepared to accept harsh austerity measures and this is the reason talks have dragged on.

However, as details of Greece’s counter proposal to troika officials emerged in the Greek press, it more than evident that the government has had to compromise greatly.

The troika is demanding that the Greek government acknowledge that an additional 2.5 billion euros in additional austerity measures are required for Greece to achieve the Memorandum target of a primary surplus of 3% of GDP in 2015.

Greek proposals include a doubling of the value-added tax rate on hotel accommodation to 13 percent; slashing salaries in the civil service from January 1; increasing the retirement age and freezing minimum pensions in 2016 and 2017; as well as further corrections next year if the budget execution goes off track. Troika officials have also raised objections to the payment of tax arrears over 100 installments which the Greek government is also forced to rethink.

Rishi Goyal, of the International Monetary Fund, told a Capital Link investment forum in New York that talks with Greek officials were “constructive”.

Earlier, Finance Minister Gikas Hardouvelis told a conference organized by the Hellenic-American Chamber of Commerce that negotiations with the troika remained “tough” but that the Greek side was persisting in a bid to “avert a return to uncertainty.”

However closer Greece has come to striking a deal with the troika, there is no doubt that the country’s government has been dealt a great blow in this latest round of negotiations. How deputies will be convinced to approve harsh measures in parliament is a headache for the coalition. Societal disapproval of the touted moves is also considered a given. SYRIZA leader Alexis Tsipras is already capitalizing on the government’s agonizing retreat in talks with the troika. Tsipras told SKAI television in an interview Monday that the current coalition leaders were “entirely expendable” in the eyes of the troika.

However, Coalition partners Samaras and Venizelos are hoping that an agreement with lenders can be reached before the next Eurogroup meeting on Monday, December 8th. The government is hoping a quick solution will put the troika issue to rest and allow New Democracy and PASOK enough time to rally MPs for a crucial presidential vote in Parliament early 2015.