Activation of contingency measures brings 8% wage and pension cuts
At the recent Eurogroup, the Minister of Finance Euclid Tsakalotos reached an agreement with Greece’s creditors regarding the contingency measures that have been requested, in order to conclude the bailout review.
This package of contingency measures worth 2% of the GDP, namely 3.6 billion euros, will come into effect the government fails to reach its target for a 3.5% GDP primary surplus by 2018.
Given that the annual state expense for pensions is 30 billion euros and 15 billion euros for public sector wages, an average 8% cut will be required in order to cover the cost of the contingency measures.
It remains to be seen whether the Greek government will manage to support such a deal in Parliament. Should Athens pass the measures, a Eurogroup on the reprofiling of the debt will be called, in turn putting an end to months of instability and uncertainty.
You may be interested
U.S. Ambassador to Greece Pyatt: The path to the acquisition of the F-35 is a multi-year processPanos - Dec 01, 2020
U.S. Ambassador to Greece Geoffrey R. Pyatt said in a message that the US defence relationship with Greece is at…
Greece confirms 1,044 new coronavirus cases on Monday, 85 fatalities; 600 in ICUsPanos - Dec 01, 2020
Greece confirmed 1,044 new coronavirus cases on Monday, of which 9 were identified at the country's entry points, said the…
Turkish survey vessel Oruc Reis returns to its port, as Greece calls on EU to impose sanctions on Turkeymakis - Nov 30, 2020
After 49 days of seismic surveys in a large sea area that included the Greek continental shelf, Turkish research ship…