Greece 'ready' for $40B bailout meeting

Nov. 20, 2012 at 3:00 AM
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BRUSSELS, Nov. 20 (UPI) -- Greece agreed to the final reforms demanded by creditors in exchange for a $40 billion bailout payment amid hopes officials would give the reforms a thumbs-up.

Athens "is more than ready" for Tuesday's meeting in Brussels of eurozone finance ministers, the International Monetary Fund, European Commission and European Central Bank, Finance Minister Yannis Stournaras said after the government used special powers to pass the reforms.

"There are no longer any outstanding issues on our behalf," Stournaras said.

Athens said it hoped the finance ministers, known as the Eurogroup, would sign off on the next chunk of aid from its second bailout, but officials from the country's international creditors were unclear what if any decision on Greece would be made Tuesday, The Wall Street Journal and The New York Times reported, despite rumors the ministers would give at least a tentative go-ahead for the disbursement.

Differences existed between the IMF and eurozone governments on how to lower Greece's huge debt burden to a manageable level, the newspapers said.

"Manageable" is considered 120 percent of annual economic output.

The IMF wants Greece's debt cut to that percentage by 2020, but the Greek economy is sliding and the country's debt level is expected to reach 190 percent of gross domestic product next year, making the 2020 target out of reach, the Journal said.

The IMF, EC and ECB make up the troika of lenders that has demanded draconian measures from Athens in exchange for two bailouts totaling more than $320 billion.

Greece used special emergency powers to decree the demanded reforms, bypassing Parliament to avoid another unruly vote that could hurt the already-fragile governing coalition.

The Parliament Nov. 8 approved a $17 billion austerity package and four years of reforms in an effort to win more bailout funds.

The decrees approved after marathon weekend meetings chaired by Prime Minister Antonis Samaras include tougher supervision of public-sector budgets, strict new rules to ensure ministries and local authorities stick to their budgets and a new requirement money raised from privatization goes nowhere except into an escrow account to be used solely to pay down public debt.

The decrees also cut the salaries and pensions of parliamentary employees, bringing them into line with those of other public sector workers.

The parliamentary employees interrupted Parliament before the Nov. 8 vote with a noisy walkout to protest the salary cut, which the government withdrew at the time so the debate could continue.

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