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Monday, 17 September 2012
GREECE PLEADS FOR TIME TO REPAY LOANS – ‘EU exit would be a catastrophe!’
THE EU-IMF-ECB-imposed Greek Prime Minister, Antonis Samaras, on Saturday called for more time to carry out savage austerity cuts, warning that a Greek exit from the euro would be a ‘catastrophe’.
Greece is currently trying to finalise a package of 11.5bn euros (£9.3bn) of spending cuts over the next two years.
The measures are needed to qualify for the next 33.5bn-euro instalment of its second 130bn-euro bailout.
In an interview with the Washington Post published yesterday, Samaras said that Greece had to ‘make sure that we abide by what we have signed because we believe that what they call a “Grexit” is not an option for us. It would be a catastrophe.’
However, he added: ‘Instead of the taking place over two years, it would be best if it (the cuts package) were to take place over four years. We are talking about an extension to 2016.’
At a Eurogroup finance ministers meeting in Nicosia in Cyprus on Friday, International Monetary Fund (IMF) head Christine Lagarde had hinted that Greece’s creditors may be receptive to giving the country more time.
She said: ‘Greece has already produced a huge effort but will have to continue to do so.
‘The target when it comes to achieving debt sustainability is very high, so there are various ways to adjust. Time is one that needs to be considered as an option.’
But a leading German politician said Germany was unlikely to agree to further help for Greece beyond that which has already been agreed.
Rainer Bruederle, parliamentary leader of the Free Democrats Party warned that once the second bailout had been paid out in full, another would not be forthcoming.
He said: ‘I can’t imagine that a further package for Greece would get a majority in the Bundestag, or in the governing coalition.
‘We Germans are helpful, but we’re not stupid.’
And Austrian Finance Minister Maria Fekter said in a newspaper interview published on Saturday that Greece will get more time to repay its debts to international lenders but will not get more money.
Asked by the Oesterreich newspaper if Athens would get a payment extension, she said: ‘Yes. We are still awaiting the Troika report and Greece still has to get some things on track but we will achieve a cost-neutral extension.’
The EU-ECB-IMF Troika is due to report next month on whether Greece has met the conditions laid down for the next instalment of its second bailout.
Greece was given a 110bn-euro package in May 2010 and a further 130bn euros in October 2011, along with a 100bn-euro debt write-off.
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