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Posted on: October 2nd, 2012 by AlYunaniya Staff No Comments

Troika, government differ over cutbacks as Greece submits 2013 budget

Stournaras Eurogroup - source EU

photo: EU

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The meeting of Prime Minister Antonis Samaras with the troika representatives yesterday afternoon ended without result. Finance minister Yannis Stournaras said: “We are trying to close the set of measures and the representatives of our lenders have once again requested clarifications. The discussions and consultations between the two sides continue,” protothema.gr writes.

Lenders’ representatives reject entirely the structural measures and insist to close the package with revenues generated from additional cuts in salaries and pensions. Finance Ministry sources told reporters that the troika is asking for more cuts in wages, pensions and benefits while the the conditionality clause is also on the table. Stournaras meets again with the troika tomorrow.

Prime Minister’s associates told reporters  that while negotiating with representatives of the troika in Greece the government is also taking part in political negotiations on a higher level. Samaras is in constant communication with both his European counterparts and with senior EU officials. The government’s aim is to comply with the schedules and close the package until the next Eurogroup. PM’s associates appear confident that an agreement with the troika will be reached soon and that in the coming days there will be a meeting of the political leaders that support the government.

According to the draft budget submitted to parliament yesterday, Greece will seek to shrink its fiscal deficit to 4.2% of GDP in 2013 from a projected 6.6% in 2012, with its economy forecast to contract by 3.8%. The draft budget targets a primary surplus of 1.1% of GDP next year with unemployment expected to hit 24.7%. Public debt is projected to reach 179.3% of GDP.

According to AP, the budget includes about EUR 7.8 billion worth of austerity measures for next year (part of the EUR 13.5 billion package) of which EUR 3.8 billion are to come from pension cuts and EUR 1.1 billion from salary cuts. Other cutbacks include trimming costs for healthcare, education and defense.

Finance Minister Yannis Stournaras submitted the draft budget to Parliament after talks with the troika.

 

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