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A New Implementation Act Expected Until Mid-August
The revised Memorandum of Understanding provides the adoption of a new implementation act by August 15, including provisions for job dismissals in the puclic sector, shutdowns of public organizations and dozens of other interventions.
After the Eurogroup approved the MoU on Saturday, it should be also approved by the IMF on July 7, so the next aid tranche would be released by July 15.
The agreement sets out a very heavy schedule for the Greece, which is called for many and major reforms.
The Greek government admits that it has delayed the implementation of several measures and promises to speed up fiscal and structural reforms and proceed with full privatizations and further measures if necessary (at September’s review).
A report by the European Commission is rather criticizing, as it prefaces the revised MoU by stating the inability to increase tax revenues and the accumulation of new arrears of €6b in the first quarter of 2011.
Additional funding needs of the country until 2014 are estimated at €55b. It should be noted that the government started discussions with private investors for their participation in the loan, while the Commission opposes against a potential restructuring of the Greek debt, as it could cause severe liquidity problems to Greek banks and contagion risks to other countries.
The MoU is up to 2014, aiming to reduce the state deficit to 2.5% of GDP and raise €35b through privatizations.
Within the coming weeks, the government will announce the following fiscal measures:
*Job dismissals in public utilities and organizations. The employees, who would serve as paid backup for 12 months and would be not feasible to be transferred, would be sacked.
*New payroll. The new payroll would be gradually introduced in August and in the following three years in order to bring the salaries of the public sector at the levels of the private sector.
*Shutdowns-mergers in the broader public sector. 1,500 public organizations would be reviewed, while 77 organizations will close or merger by mid-August.
*Privatizations. The strict schedule should be kept as a structural landmark.
*Moderators. As Jean-Claude Juncker, President of the Eurogroup, said Greece’s sovereignty will be “massively limited” due to the austerity measures.
(capital.gr)
The revised Memorandum of Understanding provides the adoption of a new implementation act by August 15, including provisions for job dismissals in the puclic sector, shutdowns of public organizations and dozens of other interventions.
After the Eurogroup approved the MoU on Saturday, it should be also approved by the IMF on July 7, so the next aid tranche would be released by July 15.
The agreement sets out a very heavy schedule for the Greece, which is called for many and major reforms.
The Greek government admits that it has delayed the implementation of several measures and promises to speed up fiscal and structural reforms and proceed with full privatizations and further measures if necessary (at September’s review).
A report by the European Commission is rather criticizing, as it prefaces the revised MoU by stating the inability to increase tax revenues and the accumulation of new arrears of €6b in the first quarter of 2011.
Additional funding needs of the country until 2014 are estimated at €55b. It should be noted that the government started discussions with private investors for their participation in the loan, while the Commission opposes against a potential restructuring of the Greek debt, as it could cause severe liquidity problems to Greek banks and contagion risks to other countries.
The MoU is up to 2014, aiming to reduce the state deficit to 2.5% of GDP and raise €35b through privatizations.
Within the coming weeks, the government will announce the following fiscal measures:
*Job dismissals in public utilities and organizations. The employees, who would serve as paid backup for 12 months and would be not feasible to be transferred, would be sacked.
*New payroll. The new payroll would be gradually introduced in August and in the following three years in order to bring the salaries of the public sector at the levels of the private sector.
*Shutdowns-mergers in the broader public sector. 1,500 public organizations would be reviewed, while 77 organizations will close or merger by mid-August.
*Privatizations. The strict schedule should be kept as a structural landmark.
*Moderators. As Jean-Claude Juncker, President of the Eurogroup, said Greece’s sovereignty will be “massively limited” due to the austerity measures.
(capital.gr)