| Series Title | Kathimerini |
|---|---|
| Series Details | 12.11.12 |
| Publication Date | 12/11/2012 |
| Content Type | News |
|
SEE ALSO: Greece battles to avert €5bn default Greece is battling to raise funds to avoid defaulting on a €5bn debt repayment this week as international lenders remained deadlocked over how to reduce its overall debt even as Athens won parliamentary approval for its 2013 austerity budget. The country’s debt management office has announced plans to cover the €5bn debt through a treasury bill auction on Tuesday, but Greek banks expected to buy the issue can only raise about €3.5bn of collateral acceptable to the European Central Bank, according to two senior Athens bankers. “The situation is quite tight,” said one banker. “They will have to find the remainder in other ways.” The ECB has not given permission for Greece to maintain a temporary €17bn ceiling for T-bill issuance due to be reduced this month to €12bn, leaving the country without a financial safety net while it waits for a much-delayed €31.5bn aid payment from international lenders. “It’s a disappointing signal . . . it seems the recent efforts that Greece has made are not appreciated,” said a senior commercial banker. If the banks are unable to find €1.5bn in other forms of collateral, Greece may seek to use funds from a €3bn reserve for bank recapitalisation held by the Hellenic Financial Stability Fund, backed by international lenders. ECB’s hardline position on Greek borrowing has intensified pressure on eurozone lenders to finalise an overhaul of Athens’ €174bn bailout at Monday’s meeting of finance ministers in Brussels. Before the budget vote, however, senior EU officials said they were doubtful a deal could be struck. Thousands of demonstrators shouting anti-austerity slogans gathered outside parliament as lawmakers prepared for the budget vote, after Greece’s two largest trade unions urged members to protest against pensions and salary cuts and plans to sack more than 10,000 public sector workers in 2013. Officials had been confident the vote would go smoothly as lawmakers from Democratic Left, the coalition government’s junior partner, had indicated they would vote in favour even though they abstained from last week’s critical vote on structural reforms. “It should be a comfortable majority compared with last week,” a government adviser said, referring to the coalition scraping a three-vote majority. “Greece will have done what it ought to have done,” the adviser added, referring to international lenders’ insistence that both pieces of legislation be approved for Greece to receive further funding from its €174bn bailout package. Yet Athens’ hopes of securing a firm date in November for receiving the desperately needed transfer have been dashed by differences between international lenders over the projected pace of Greek debt reduction. The EU and International Monetary Fund were trying at the weekend to bridge a 5-10 percentage point gap in their respective debt forecasts for 2020, following a sharp downward revision by the IMF of Greek growth prospects in 2013-14. The four-day budget debate triggered angry exchanges in parliament with the leftwing main opposition Syriza coalition claiming that Greece’s creditors were “playing games” with the country’s future. “The government used blackmail to get these measures approved . . . They lied to us about the disbursement of the loan,” said Alexis Tsipras, the Syriza leader. Yannis Stournaras, the technocrat finance minister, rounded on his critics in parliament, saying the opposition’s proposals for a softer adjustment “amount to conditions for a disorderly default, which, if it happens, will result in hunger and misery”. Additional reporting by Peter Spiegel in Brussels Copyright The Financial Times Limited 2012. The Greek Parliament approved the 2013 budget involving fresh spending cuts on the 11 November 2012, despite mass public street protests. The move was a pre-condition for Greece to be granted a €31.5bn EU/IMF loan necessary to stave off bankruptcy. Eurozone finance ministers were due to discuss the Greece crisis at a meeting in Brussels on the 12 November 2012. In the event Eurozone finance ministers agreed to give Greece two more years, until 2016, to meet its deficit-reduction targets. However the ministers delayed a decision on releasing the latest €31.5bn tranche of bailout funds. |
|
| Source Link | Link to Main Source http://ekathimerini.com/4dcgi/_w_articles_wsite1_1_12/11/2012_469548 |
| Related Links |
|
| Countries / Regions | Greece |
