Greece’s Creditors Request 3-Billion-Euro Budget Cuts

Óôéãìéüôõðï áðü ôçí óõíåäñßáóç ôïõ Eurogroup, ôçí ÄåõôÝñá 16 Öåâñïõáñßïõ 2015, óôéò ÂñõîÝëëåò. (EUROKINISSI/Å.Å.)

There have been major developments in the negotiations between Greece and its creditors so that the two parties can reach an agreement as soon as possible, reported Bloomberg.

According to the international agency, which cites information from a European official, the Greek government must take new austerity measures “to raise at least three billion euros through additional fiscal measures by the end of this year to meet the minimum budget targets acceptable by creditors.”

However, Bloomberg poses an interesting question. How will the Greek government take additional fiscal measures when it is so committed against austerity?

“The reductions would bring the primary budget surplus in 2015 to just over 1% of gross domestic product, a target Greek Interior Minister Nikos Voutsis said today is acceptable. Without any change in fiscal policy, Greece would end 2015 with a budget deficit of about 0.5 percent of GDP, the official said. The so-called primary budget balance doesn’t include interest payments,” noted the article.

According to Bloomberg there are still may differences to be resolved. At the moment the two parties are disagreeing on “the retirement age, pension cuts, privatizations and the government’s intention to reinstate collective bargaining restrictions in the labor market.”

Meanwhile, the Greek Finance Ministry representative declined to comment on the reports regarding the new austerity measures that the creditors are requesting.