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Greece's Cabinet Approves Five-Year Austerity Plan
ATHENS -(Dow Jones)- Greece's cabinet Thursday approved a tough, five-year austerity plan which the country has promised its international creditors but comes amid growing opposition on the streets of Athens and wavering support within the ruling Socialist party.
The plan foresees some EUR28.4 billion in new spending cuts and revenue measures aimed at bringing Greece's budget deficit below 1% of gross domestic product by 2015, down from 10.5% of GDP last year.
The measures are to be introduced to parliament later Thursday in an omnibus bill that is expected to be voted on June 28. Separate implementing legislation is expected to be introduced in a week's time, and to be voted on by July 8.
In May last year, Greece narrowly avoided default with the help of a EUR110 billion loan from its fellow euro-zone members and the International Monetary Fund in exchange for austerity measures and economic reforms.
Greece must pass the measures before receiving the next tranche of that loan, which is expected to be disbursed in early July.
But faced with prohibitively high borrowing costs on international markets, Greece is now seeking another EUR60 billion loan to cover its financing needs for the next two years.
ATHENS -(Dow Jones)- Greece's cabinet Thursday approved a tough, five-year austerity plan which the country has promised its international creditors but comes amid growing opposition on the streets of Athens and wavering support within the ruling Socialist party.
The plan foresees some EUR28.4 billion in new spending cuts and revenue measures aimed at bringing Greece's budget deficit below 1% of gross domestic product by 2015, down from 10.5% of GDP last year.
The measures are to be introduced to parliament later Thursday in an omnibus bill that is expected to be voted on June 28. Separate implementing legislation is expected to be introduced in a week's time, and to be voted on by July 8.
In May last year, Greece narrowly avoided default with the help of a EUR110 billion loan from its fellow euro-zone members and the International Monetary Fund in exchange for austerity measures and economic reforms.
Greece must pass the measures before receiving the next tranche of that loan, which is expected to be disbursed in early July.
But faced with prohibitively high borrowing costs on international markets, Greece is now seeking another EUR60 billion loan to cover its financing needs for the next two years.
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