World Economy

Greece Defiant Over Economic Plans

Greece Defiant Over Economic PlansGreece Defiant Over Economic Plans

Prime Minister Alexis Tsipras of Greece has said he is sticking to plans to roll back austerity and rejecting an international bailout extension.

He said Greece, unable to service its debt, would instead seek a bridge loan. He told parliament he would keep all pre-election pledges, promising to raise the minimum wage, pay a pension bonus and rehire public workers, BBC reported.

Tsipras’s far-left Syriza party won elections last month on a promise to end austerity measures. EU officials have rejected his efforts to renegotiate Greece’s bailout terms.

“The bailout failed,” Tsipras said on Sunday, in his first major speech to parliament since becoming prime minister. “The new government is not justified in asking for an extension... because it cannot ask for an extension of mistakes. After five years of bailout barbarity, our people cannot take any more.”

  Humanitarian Crisis

Tsipras said the government’s “irreversible decision is to implement in full our pre-elections pledges”. The first priority, he said, was “tackling the big wounds of the bailout, tackling the humanitarian crisis”. That included giving free food and electricity to those worst affected by the economic crisis and ending an unpopular annual levy on private property.

Among other commitments outlined on Sunday were:

- a gradual rise in the minimum wage to €751 ($850) by 2016

- payment of a bonus to low-income pensioners

- reinstatement of public sector employees “fired illegally”

- the creation of a new national broadcaster

Two of the measures – raising the minimum wage and restoring a tax-free threshold to €12,000 – contravene reforms made previously as conditions for receiving bailout money.

Tsipras also announced a number of measures aimed at cutting costs or raising revenue, including

- a new tax on large properties

- a special portfolio to oversee fight against corruption and tax evasion

- a pension fund using revenues from natural resources

- cutting ministry cars and government aeroplanes.

The Greek prime minister also repeated demands that Germany – Greece’s biggest creditor – pay reparations for World War Two and repay a loan that the Nazis forced the Bank of Greece to pay when they occupied Greece.

Greece had “a moral obligation to our people, to history, to all European peoples who fought and gave their blood against Nazism”, he said. Greece’s current program of loans ends on February 28. A final €7.2b is still to be negotiated, but Greece wants permission to issue additional short-term debt while it seeks a new deal.