THE REASONS WHY THERE IS NOT AN AGREEMENT BETWEEN GREECE AND THE “TROIKA”


The Tsipras Government’s Plan does not undertake the big reforms asked by the so-called Troika’s negotiators –formed by the European Central Bank, the International Monetary Fund and the European Commission. While Greece is running out of time to give back a loan to the IMF before this Friday (5/6/2015), Alexis Tsipras presented a plan to give an end to six years of crisis. A plan that does not undertake the great reforms requested by the EU negotiators, although the Greek Executive does show certain intention of reaching an agreement.

WHAT IS REQUESTED BY THE “BRUSELAS GROUP”

  • Reduction of the public spending
  • Improvement of tax incomes, in order to enhance the State’s incomes and a rise of IVA
  • Rationalize pensions and make this system sustainable
  • Program of privatizations as a source of incomes and keep ongoing plans underway.

WHAT ALEXIS TSIPRAS OFFERS

  • Fewer cutbacks and fewer debts. Tsipras tries to renegotiate the debt, in order to settle the annulment of part of the debt simply because Greece cannot pay it.
  • Limitation of the IVA’s increase: Greece offers keep three types of IVA (6%, 11% and 23%) to collect 1,000 millions of Euros, while European negotiators ask 2,000 million more with two types.
  • Less early retirements: the Greek Government accepts the gradual restriction of early retirements but not the sustainability of the public system of pensions.
  • They want the electricity kept public. They accept other kinds of privatizations, but not in this realm.
  • Athens also tries to gain a greater margin in order to be able of making social policies. That is why Tsipras wants to reduce the aim of primary surplus roughly to 1% of GDP in 2015 and 2% in 2016; while the previous objective was 3% in 2015 and 4% in 2016.

Here Tsipras gives the hand to Jean-Claude Juncker, President of the European Commission. http://ep01.epimg.net/internacional/imagenes/2015/06/03/actualidad/1433360287_548191_1433360441_noticia_normal.jpg

Although there is no an agreement between Athens and the “Troika” and now Greece is found in a hard situation due to the difficulties in paying the debts back the President of the European Commission, Jean-Claude Juncker, thinks that the way out of Greece is not a “desirable framework” because it could bring more problems than solutions. If it would occur, the people would start to think that the euro is not reversible.

Pier Carlo Padoan, Minister of Economies and Finances in Italy, believes that it “is possible”, although there would be consequences in a mid-term because, as Juncker said, it would mean that the euro is reversible.

However, Padoan believes that nobody is in the condition to say how the way out of Greece would be managed. However, he hopes that Tsipras reaches an agreement with the creditors these days.

This is a crucial week for Greece: it must pay the first part of the 300 million Euros to the IMF, while this month it has to give back roughly 1,600 million Euros.

In general, some conclusions have been great progresses with Greece, although there is still a long way to walk, although conversations start to be successful.

Pierre Moscovici, Commissioner of Economic Issues in Italy, points out that there has been a progress in concrete issues –IVA and reform of Greek Administration- even though the time to reach an agreement “hurries”.

BIBLIOGRAPHY

http://www.expansion.com/economia/2015/06/01/556cabf0268e3e5f108b458c.html

http://internacional.elpais.com/internacional/2015/06/01/actualidad/1433194209_089453.html

http://www.dw.de/juncker-salida-de-grecia-del-euro-acarrear%C3%ADa-m%C3%A1s-problemas/a-18491258

http://www.abc.es/internacional/20150603/abci-porque-grecia-acuerdo-bruselas-201506022142.html

http://elpais.com/elpais/2015/06/02/opinion/1433263452_484084.html

http://internacional.elpais.com/internacional/2015/06/03/actualidad/1433360287_548191.html

Anuncios

Los comentarios están cerrados.

A %d blogueros les gusta esto: