Politicians spell out 'only hope' for Greece
Source: Agencies |
May 7, 2010, Friday
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Print Edition
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GREECE'S only hope of avoiding bankruptcy is to take money from a joint EU and International Monetary Fund rescue package, the government said yesterday during a heated parliamentary debate overshadowed by the deaths of three people during protests against spending cuts.
Greece has to impose harsh austerity measures, including slashing salaries and pensions and increasing taxes, in order to get money from the 110 billion euro (US$140 billion) three-year package, which will provide the country with loans from other eurozone countries and the IMF.
"Today things are simple. Either we vote and implement the deal, or we condemn Greece to bankruptcy," Prime Minister George Papandreou said ahead of a parliamentary vote on the austerity measures.
The rescue loans are aimed at containing the debt crisis and keeping Greece's troubles from spreading to other countries with vulnerable state finances such as Portugal and Spain.
The euro has sagged as those countries have seen debt downgrades, falling below US$1.28 yesterday; late last year it was as high as US$1.51.
Burning bank
The spending cuts have sparked outrage in Greece, with about 100,000 people spilling onto the streets of Athens during a nationwide general strike on Wednesday.
Demonstrations quickly turned violent, with protesters trying to storm parliament and clashing with police in riots that saw banks, stores and hotel windows smashed and two buildings burned. A man and two women - one of whom was pregnant - died when they became trapped in a burning bank torched by protesters. Firefighters used a crane to rescue another four people from the building.
Finance Minister George Papaconstantinou said the government had no choice but to impose the austerity measures, which were being rushed through the parliament.
He said the draft bill was introduced as urgent legislation because the country was two weeks away from default, with 8.5 billion euros worth of bonds maturing on May 19.
"The state's coffers don't have that money," Papaconstantinou said. "The only way for the country to avoid bankruptcy and suspension of payments is to take the money from our European partners and the International Monetary Fund."
Greece has to impose harsh austerity measures, including slashing salaries and pensions and increasing taxes, in order to get money from the 110 billion euro (US$140 billion) three-year package, which will provide the country with loans from other eurozone countries and the IMF.
"Today things are simple. Either we vote and implement the deal, or we condemn Greece to bankruptcy," Prime Minister George Papandreou said ahead of a parliamentary vote on the austerity measures.
The rescue loans are aimed at containing the debt crisis and keeping Greece's troubles from spreading to other countries with vulnerable state finances such as Portugal and Spain.
The euro has sagged as those countries have seen debt downgrades, falling below US$1.28 yesterday; late last year it was as high as US$1.51.
Burning bank
The spending cuts have sparked outrage in Greece, with about 100,000 people spilling onto the streets of Athens during a nationwide general strike on Wednesday.
Demonstrations quickly turned violent, with protesters trying to storm parliament and clashing with police in riots that saw banks, stores and hotel windows smashed and two buildings burned. A man and two women - one of whom was pregnant - died when they became trapped in a burning bank torched by protesters. Firefighters used a crane to rescue another four people from the building.
Finance Minister George Papaconstantinou said the government had no choice but to impose the austerity measures, which were being rushed through the parliament.
He said the draft bill was introduced as urgent legislation because the country was two weeks away from default, with 8.5 billion euros worth of bonds maturing on May 19.
"The state's coffers don't have that money," Papaconstantinou said. "The only way for the country to avoid bankruptcy and suspension of payments is to take the money from our European partners and the International Monetary Fund."
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