News / Europe

Greece Reaches Accord on Austerity Demands

Greece's Prime Minister Lucas Papademos (L) escorts Socialist leader George Papandreou (C), conservative party leader Antonis Samaras (3rd L) and Far-right leader George Karatzaferis (2nd R) at his office in Athens, February 8, 2012.
Greece's Prime Minister Lucas Papademos (L) escorts Socialist leader George Papandreou (C), conservative party leader Antonis Samaras (3rd L) and Far-right leader George Karatzaferis (2nd R) at his office in Athens, February 8, 2012.

Greek lawmakers say they have reached an accord on austerity measures demanded by international lenders so the country can secure another bailout and avoid defaulting next month on its financial obligations.

After an all-night negotiating session that ended early Thursday, Greek political leaders remained deadlocked on the extent of pension cuts for retirees, while agreeing to trim the country's minimum wage by 22 percent and eliminate 15,000 government jobs.

Hours later, however, Prime Minister Lucas Papademos and his coalition partners announced they had found an unspecified, alternative way to pare government spending, marking a key turning point after weeks of negotiations with Greece's creditors.

Related video by Mil Arcega:


Greek Finance Minister Evangelos Venizelos headed to a Brussels meeting with other European finance ministers to plead the debt-ridden country's case to win their approval for a new $172 billion bailout, the country's second in two years. Greece says it needs the aid package from the European Union, the European Central Bank and the International Monetary Fund in order to avoid defaulting on $19 billion in bond payments due in March.

EU Economic Commissioner Olli Rehn said Greece will have to convince the finance chiefs it is serious about economic reform.

"We have a staff level agreement now and I am sure the ministers will thoroughly scrutinize this agreement and it's up to the Greek government by concrete actions through legislation, and other actions to convince its European partners that the second program can be made to work," he said.

The Athens government is also completing negotiations with private lenders to cut in half the amount it owes them, a $132 billion reduction. Under the revised financing of the country's debt, 32 large financial institutions would lose 70 percent of their Greek investment.

European leaders have grown impatient with Greece's protracted negotiations over its debt, with financial analysts voicing fears that a default could plunge the global economy into a new recession. Meanwhile, Greek leaders have faced widespread opposition at home from workers angered by earlier austerity measures. Unions called for more work stoppages on Friday and Saturday to protest the latest budget-cutting plan.

Even with the agreement on more austerity, Greece remains in a precarious financial state. It is in the fifth year of a recession. The government says the country's unemployment rate is increasing and nearly reached 21 percent in November.

Meanwhile, the continent's central bank kept its benchmark lending rate at the record low rate of 1 percent, in an effort to spur economic growth. The bank has kept the rate low as the 17-nation bloc that uses the euro currency faces a stalled economy and is possibly headed to a recession.

Bank chief Mario Draghi says Europe's economy remains threatened.

"Based on our regular economic and monetary analysis we decided to keep the key ECB interest rates unchanged. the information that has become available since January, broadly confirms our previous assessment. Inflation is likely to stay above 2 percent for several months to come before declining to below 2 percent. Available survey indicators confirms some tentative signs of stabilization in economic activity at low level around the turn of the year. The economic outlook remains subject to high uncertainty and downside risks," said Draghi.

Draghi rejected the idea that the central bank assume losses on the Greek debt it holds. But he said the bank could return some of its profits on the Greek bonds to the countries supporting the institution.

Some information for this report was provided by AP and AFP.

You May Like

Video VOA Reporter Tours Devastated Peshawar School

Islamist militants wearing military uniforms and strapped with explosives attacked a military run school Tuesday in the northwestern Pakistani city of Peshawar. At least 141 people were killed in the horrific attack, most of them young students. More

Video Sudan School Becomes Target of Aerial Attacks

Dropout rate at an all-time high in South Kordofan state because many schools have been destroyed during 3-year civil war More

Tennessee Songbirds Fly Coop Long Before Tornadoes Arrive

Researchers say birds apparently alerted to danger by sounds at frequencies below range of human hearing More

This forum has been closed.
Comments
     
There are no comments in this forum. Be first and add one

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
Sudan School Becomes Target of Aerial Attacksi
X
December 19, 2014 12:45 AM
The school dropout rate is at an all-time high in Sudan's South Kordofan state because many schools have been destroyed during the three-year civil war between the government and SPLA-N rebel forces. Adam Bailes visited Sudan's Nuba Mountains' region and reports many children are simply too scared to go to school
Video

Video Sudan School Becomes Target of Aerial Attacks

The school dropout rate is at an all-time high in Sudan's South Kordofan state because many schools have been destroyed during the three-year civil war between the government and SPLA-N rebel forces. Adam Bailes visited Sudan's Nuba Mountains' region and reports many children are simply too scared to go to school
Video

Video VOA Reporter Tours Devastated Peshawar School

Islamist militants wearing military uniforms and strapped with explosives attacked a military run school Tuesday in the northwestern Pakistani city of Peshawar. At least 141 people were killed in the horrific attack, most of them young students. VOA reporter Ayaz Gul visited the devastated school and attended the funeral of the principal who courageously tried to save her students from the deadly attack.
Video

Video Nigerians Fleeing Boko Haram Languish in Camp Near Capital

In its five-year effort to impose Islamic law in northeastern Nigeria, the Boko Haram extremist group has killed thousands of people and forced hundreds of thousands to flee. Some of those who ran for their lives now live in squalor on the edges of the capital, Abuja. Chris Stein reports for VOA.
Video

Video Putin Says Russian Economy Will Emerge Stronger

Russian President Vladimir Putin has said his country's sinking economy will not only recover but also become stronger, despite falling oil prices and Western sanctions over Ukraine. VOA's Daniel Schearf reports.
Video

Video Detained Turkish Journalists Follow Teachings of US-Based Preacher

The Turkish government’s jailing of critical journalists has sparked international condemnation and is being seen as an effort to undermine the followers of an ailing Turkish preacher based in the United States. VOA religion reporter Jerome Socolovsky has more.
Video

Video ‘Anti-Islamization’ Marches Increase Tensions In Germany

Anti-immigrant rallies in Germany have been building in recent weeks, peaking Monday night in the city of Dresden where tens of thousands of people turned out to demonstrate against what they call the ‘Islamization’ of the West. Germany has offered asylum to more Syrian refugees than any other country, and this appears to have set off the protests. Henry Ridgwell reports from London.
Video

Video Aceh Rebuilt Decade After Tsunami, But Scars Remain

On December 26, 2004 there was an earthquake in the Indian Ocean so powerful it caused the Earth’s axis to wobble a few centimeters. Onshore on the island of Sumatra, the resulting tsunami was devastating. A decade later, VOA Correspondent Steve Herman reports from Banda Aceh, Indonesia, where although there is little remaining evidence of the physical devastation, the psychological scars among survivors remain.
Video

Video Refugees Living in Kenya Long for Peace in the Home Countries

Kenya is host to numerous refugees seeking safe haven from conflict. Immigrants from Somalia face challenges in their new lives in Kenya. Ahead of International Migrants Day (December 18) Lenny Ruvaga has more for VOA News from the Kenyan capital.

All About America

AppleAndroid