Greeks cannot take more austerity, foreign minister warns

The Greek population cannot suffer more cuts in the name of austerity, Foreign Minister Evangelos Venizelos warned on Tuesday, amid talk that Athens might need yet another bailout to plug its finances.

Since 2010, Greece has received 250 billion euros ($350 billion) in international loans, but its economy is far from fixed.

After six years of recession, unemployment is close to 30 per cent while public debt stands at 160 per cent of gross domestic product.

“We cannot think about new cuts to pensions and wages. From 2010 to 2012, Greek incomes have fallen by over 35 per cent, something that is unique and unacceptable during peace times,” Venizelos said in an interview with the Italian news agency ANSA.

It was published during his visit to Rome, where he was due to meet his Italian counterpart Emma Bonino.

Greece has said that if it required a new bailout in 2014, it would be a much smaller package of around 10 billion euros.

Brussels has indicated that Athens might need more support as it struggles to fix its economy, with Euro-Group Chairman Jeroen Dijsselbloem insisting that this does not necessarily mean more money but could take the form of lower interest rates or easier access to structural funds.

Venizelos stressed that Greece had done “four-fifths” of the effort to straighten its finances, noting that it will achieve a primary surplus — that is, excluding debt repayment costs — by next year. The economy is also expected to pick up in 2014.

He called for more help from European partners. “We cannot accept to have governments with decision powers and other states who are forced to comply to avoid bankruptcy or disasters for the economy and the banks,” he said.

“We need new forms of solidarity, new forms of redistribution within the Euro zone,” Venizelos said.

Venizelos’ visit to Italy comes as tens of thousands of workers were striking back home against planned redundancies.

High school and university teachers began rolling, five-day strikes on Monday. Social security staff have also joined the action and state hospitals were only treating emergencies after doctors walked off the job.

Protests are expected to peak on Wednesday as primary school teachers, lawyers, suburban rail workers and garbage collectors will join a 48-hour walkout by civil servants.

The Government plans to suspend 25,000 public servants this year, and to fire 15,000 by the end of 2014.

Decisions on fresh financial relief for Greece and other bailed-out nations such as Ireland and Portugal are not expected until later this year, following Germany’s parliamentary elections on Sunday.

In Greece’s case, the country will also require the new debt sustainability assessment before Brussels can proceed with new economic support.

Decisions on fresh financial relief for Greece and other bailed out nations such as Ireland and Portugal have been held off in Brussels. Discussions were expected to resume after Germany’s parliamentary elections, due Sunday.

As the biggest economy in the currency bloc, Germany pays the largest share of euro area rescue packages, and effectively has the biggest say over them.

COMMENT NOW