The Greek
government sent a package of reform proposals to its euro zone creditors on
Thursday in a race to win new funds to avert bankruptcy and will seek a
parliamentary vote on Friday to endorse immediate actions.
In turn, Athens bowed to demands to phase
out tax breaks for its islands -- cash cows for the tourism industry -- and to
hike taxes on shipping companies.
The chairman of Eurogroup finance ministers
confirmed receiving the documents but will not comment until they have been
assessed by experts from the European Commission, European Central Bank and
International Monetary Fund. U.S. stock futures jumped 1 percent in early Asian
trade on the announced measures.
Greek lawmakers will be asked on Friday to
authorize the leftist government to negotiate a list of "prior
actions" it would take before any fresh aid funds are disbursed, a key
step to convince skeptical lenders of its serious intent.
Leftist Prime Minister Alexis Tsipras spent
the day with his cabinet drafting a last-ditch package of measures on which
Greece's survival in the euro zone hinges.
A further vote would be needed to turn them
into law if euro zone leaders agree at a summit on Sunday that the proposals
are a basis for starting negotiations on a three-year loan and releasing some
bridging funds to keep Greece afloat.
In a sign of possible trouble ahead, the
head of Tsipras's junior coalition ally -- which has threatened to pull the
plug on the government if the island tax breaks were scrapped -- did not add
his signature to the reform proposals. Neither did Energy Minister Panagiotis
Lafazanis, who leads the far-left flank of the ruling Syriza party.
The latest offer also included defense
spending cuts, a firm timetable for privatizing state assets such as Piraeus
port and regional airports, hikes in VAT for hotels and restaurants and
slashing a top-up payment for poorer pensioners.
Greek banks have been closed since June 29,
when capital controls were imposed and cash withdrawals rationed after the
collapse of previous bailout talks. Greece defaulted on an IMF loan repayment
the following day and now faces a critical July 20 bond redemption to the ECB
of 3.49 billion euros, which it cannot make without aid.
The country has had two bailouts worth 240
billion euros from the euro zone and the IMF since 2010, but its economy has
shrunk by a quarter, unemployment is more than 25 percent and one in two young
people is out of work.
Germany, Athens biggest creditor, meanwhile
made a small concession by acknowledging that Greece will need some debt
restructuring as part of the new program to make its public finances viable in
the medium-term.
The admission by hardline German Finance
Minister Wolfgang Schaeuble came hours before the midnight deadline for Athens
to submit its reform plan.
Schaeuble, who makes no secret of his doubts
about Greece's fitness to remain in the currency area, told a conference in
Frankfurt: "Debt sustainability is not feasible without a haircut and I
think the IMF is correct in saying that." But he added: "There cannot
be a haircut because it would infringe the system of the European Union."
He offered no solution to the conundrum, which implied that Greece's debt
problem might not be soluble within the euro zone. But he did say there was
limited scope for "reprofiling" Greek debt by extending loan
maturities, shaving interest rates and lengthening a moratorium on debt service
payments.
Πηγή:
reuters.com
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