Greece to Approve New Cuts to Secure Cash, Debt Relief
Greece's parliament on Thursday was to approve a new round of austerity cuts, hoping to secure a pledge of debt relief and loan payment approval by the country's EU-IMF creditors this month.
The parliament building is seen through flare smoke during a demonstration of uniformed officers marking a 24-hour general strike against the latest round of austerity in Athens, Greece. Image: Reuters
Athens: Greece's parliament on Thursday was to approve a new round of austerity cuts, hoping to secure a pledge of debt relief and loan payment approval by the country's EU-IMF creditors this month.
Overall, the bill to be approved entails 4.9 billion euros ($ 5.4 billion) in cuts in 2018-2021.
Tsipras grudgingly accepted to legislate another round of pension cuts and lower tax breaks -- applicable in 2019 and 2020 respectively -- to unlock the cash payment ahead of looming debt repayments in July.
On Wednesday, at least 18,000 people demonstrated in Athens and Thessaloniki in union-sponsored protests against the bill. Another protest in Athens is scheduled on Thursday during the parliament vote.
Athens hopes that the loan payment will be approved by a meeting of eurozone finance ministers on May 22. It also expects a clear eurozone pledge later this month on measures to ease repayment on its huge public debt, which represented 179 percent of annual output at the end of last year.
Athens also hopes to be finally allowed access to the European Central Bank's asset purchase programme, known as quantitative easing, or QE, to help its return to bond markets.
There is speculation that Greece plans to issue a three or five-year bond in July.
"If parliament approves the measures and the eurogroup decides on something more specific and binding on debt sustainability, then, yes, I think the executive board of the ECB will bring the matter for discussion in the governing council," Stournaras told Politico website on Tuesday.
"There is plenty of time for Greece to benefit from QE," Stournaras said.
"Greece needs to return to markets after the end of this program in 2018," the Bank of Greece governor said.