23rd Oct 2016

Germany stalls Greek bailout money

Germany is stalling the payment of a €2.5 billion bailout tranche to Greece, pending further job cuts in the public sector.

The tranche was supposed to have been paid earlier this month, but Athens will likely have to wait another week untill all 22 "prior actions" are met and the Bundestag gives its blessing.

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  • Greece is waiting for a €2.5 billion tranche (Photo: Constantine Gerontis)

"There is a preliminary report by the troika, saying that most prior actions are met, but some are still outstanding," Hans Joachim Narzynski, a spokesman for the German finance ministry said Wednesday (24 July) in a press conference.

He said the final troika report is expected "very soon", with the Greek parliament set to adopt one last measure on Thursday related to further public sector cuts.

Some 4,200 public sector workers, including teachers and doctors, will be put in a "labour mobility scheme", which should be boosted to 12,500 by September and another 12,500 in December.

A teleconference between eurozone finance officials took place on Wednesday and another one will be called on Thursday, but a final green light is not expected before 29 July, after the relevant committee in the Bundestag gives its approval.

The €2.5 billion are only part of a larger tranche of €6.8 billion which Greece should receive by end October. Eurozone finance ministers earlier this month decided to break the tranche into several parts and link each of them to precise cuts and privatisations.

A few hundred doctors and nurses protested in Athens on Wednesday against the planned job cuts, as the capital's six major hospitals are to be merged and reduced in size.

Trade unions also staged a 24-hour strike against the troika-imposed measures, in a country where three years of austerity and recession have also seen violent clashes with police.

German finance minister Wolfgang Schaeuble visited Athens last week in a bid to soothe the anger of the Greek people against what they see as a German-imposed austerity diktat.

"This visit is an expression of our confidence in, and support for Greece. I have not come as a teacher to give lessons," he said back then.

But without Athens fulfilling all the promised cuts, Schaeuble is not willing to give his green light to the disbursement of further money.


Europe ready to tackle Greek debt relief

The Greek government has built and broadened alliances in EU institutions and member-states that acknowledge the need to restructure the debt and deliver another economic model for the eurozone.

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